The legal brouhaha between Anheuser-Busch and MillerCoors continued last week in the Seventh Circuit over an ad that was run during Super Bowl LIII. Read More
MillerCoors is a beer brewing company in the United States. In 2002 South African Breweries purchased Miller Brewing Company to create SABMiller. In 2005, Molson Brewery of Canada and Coors Brewing Company merged to form the Molson Coors Brewing Company. Then, in 2008, SABMiller and Molson Coors created MillerCoors as a joint venture for their operations in the U.S. The company is the second-largest brewer in the U.S., after Anheuser-Busch.
These component companies had very different backgrounds. Miller Brewing was started in 1855 by settler Frederick Miller who had been studying the making of beer for years; he first owned Plank Road Brewery before opening the first Miller Company in Milwaukee. The original Molson Brewery was started by John Molson in Montreal, Canada in 1786. Coors Brewing Company was started by Adolph Coors, who emigrated from Prussia, in Colorado in 1873 and went through several name changes over the years until it was merged with Molson’s in 2005, becoming Molson Coors Brewing Company.
On October 11, 2016, SABMiller sold its stake in MillerCoors for around US $12 billion after the company was acquired by Anheuser-Busch InBev, making Molson Coors the 100 percent owner of MillerCoors. In effect, MillerCoors became the “U.S. business unit of Molson Coors.” In Canada, Molson Coors regained the right (from SABMiller) to make and market Miller Genuine Draft and Miller Lite.
Molson Coors plans to keep the MillerCoors name and the Chicago headquarters and plans to operate it in much the same way as before October 11, 2016. For the consumer, and for employees, the change to 100 percent ownership (from the previous 42 percent) by Molson Coors will not be apparent, according to Jon Stern, MillerCoors’ director of media relations. “The good news is that none of this impacts Milwaukee or Wisconsin. It’ll be business as usual. Miller Lite, Coors Light, Miller High Life and Leinenkugel’s — and frankly all the rest of our brands will continue to be brewed by us.”
MillerCoors was announced as a joint venture between SABMiller and Molson Coors in October 2007 and was approved by regulators on June 5, 2008. The venture was completed on June 30, 2008 and MillerCoors began operation on July 1, 2008.
On September 14, 2015, Miller Coors announced that it would shut down its Eden, North Carolina brewery in September 2016 due to declining corporate sales. The company has newer plants in Virginia and Georgia that will serve the Eden plant’s distribution area.
In May 2016, the Milwaukee Journal Sentinel reported that Pabst Brewing Company and Blue Ribbon Intermediate Holdings filed a lawsuit because Pabst wanted to continue making its beers in Eden.
Sole Ownership by Molson Coors
During the merger discussions between Anheuser-Busch InBev and SABMiller in 2015, the U.S. Department of Justice (DOJ) had agreed to proposed deal only on the basis that SABMiller “spins off all its MillerCoors holdings in the U.S. — which include both Miller- and Coors-held brands — along with its Miller brands outside the U.S.” The entire ownership situation was complicated: “In the United States, Coors is majority owned [58%] by MillerCoors (a subsidiary of SABMiller) and minority owned by Molson Coors, though internationally it’s entirely owned by Molson Coors, and Miller is owned by SABMiller.” SABMiller agreed to divest itself of the Miller brands by selling its stake in MillerCoors to Molson Coors.
After the merger on October 10, 2016 was concluded, SABMiller sold to Molson Coors full ownership of the Miller brand portfolio outside of the U.S. and Puerto Rico for U.S. $12 billion. Molson Coors also retained “the rights to all of the brands currently in the MillerCoors portfolio for the U.S. and Puerto Rico, including Redd’s and import brands such as Peroni, Grolsch and Pilsner Urquell.” The agreement made Molson Coors the world’s third largest brewer. The company is now also the largest brewer in the U.S.
The Molson Coors press release provides a summary of the net effect in terms of the Miller portfolio. “As part of the transaction, Molson Coors gains full ownership of the Miller brand portfolio outside of the U.S. and Puerto Rico, and retains the rights to all of the brands currently in the MillerCoors portfolio for the U.S. and Puerto Rico, including Redd’s and import brands such as Peroni, Grolsch and Pilsner Urquell.”
In the U.S., the change is merely one of ownership (from 42 percent to 100 percent by Molson Coors), and that will not be relevant or apparent to consumers or to MillerCoors employees through wholesale market. However, the company was planning to increase investment in several of its brands, including new national marketing and advertising campaigns, to increase sales.
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MillerCoors is owned by Molson Coors
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