By Diane Bartz
WASHINGTON (Reuters) - The U.S. Justice Department and Anheuser-Busch InBev <ABI.BR>, embroiled in a battle over whether AB InBev can expand its stake in the Mexican brewing company Grupo Modelo, asked a court on Friday to extend a delay in the court fight as the two sides hold settlement talks.
The Justice Department and the companies had previously requested and received a limited stay that put the case on hold until March 19.
The Justice Department had filed a lawsuit on January 31 aimed at stopping AB InBev, the world's largest brewer with some 200 brands, from buying the 50 percent of Modelo it does not already own for $20.1 billion.
When the deal was originally announced, AB InBev said it would sell its 50 percent share of Modelo's U.S. distributor, Crown Imports, to Constellation Brands <STZ.N>, the world's largest wine company.
After the Justice Department sued to stop the deal, AB InBev announced that it was willing to sell Modelo's Piedras Negras brewery in Mexico near the U.S. border to Constellation for $2.9 billion and that it would grant Constellation perpetual rights for Corona and other Modelo brands in the United States.
The companies said in a joint statement that they "have made substantial progress" in talks with the Justice Department.
"The parties agree that an extension of the current stay will likely enable the parties to complete their discussions," the companies said. "There can be no assurance that the ongoing discussions will be successful."
A Justice Department spokeswoman was not immediately available for comment.
The case was filed in the U.S. District Court for the District of Columbia. It is United States of America v. Anheuser-Busch InBev and Grupo Modelo. The case is No. 13-cv-00127.
(Reporting by Diane Bartz; Editing by Gary Hill, Bernard Orr)
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