New U.S. brewing giant MillerCoors, whose roots include the Molson brand of products, may mark Canada’s birthday by formally launching its operations.
The brewer is hoping to formally open its doors July 1 once the joint venture between London-based SABMiller and Molson Coors Brewing Co. closes, uniting operations in the United States and Puerto Rico.
The deal, which was approved by U.S. antitrust regulators Thursday, isn’t expect to affect Molson Coors’ Canadian operations, but the departure of Leo Kiely and Tim Wolf will lead to replacements being named as CEO and chief financial officer of the parent company.
The business created by the union of the No. 2 and No. 3 beer companies in the United States is expected to sell 69 million barrels of beer annually with revenues of about US$6.6 billion.
It will have 30% of the American market share. St. Louis-based Anheuser-Busch has nearly 50% of the market.
The union is expected to deliver US$500 million in annual cost synergies by the third full year of operations.
Kiely said the move will lead to growing its brands and consumer offerings.
“We’re actively engaged in the various planning elements and are ready to get out of the gate smoothly and quickly upon close,” he said in a statement.
Kiely, Miller CEO Tom Long and Coors vice-chairman Pete Coors will unveil the new MillerCoors executive team, along with plans for integrating the marketing, sales and operations teams on Monday.
The Molson Coors board will follow later in the week by announcing its new leadership team. Industry observers who didn’t want to be named suggested the new chief executive could be Peter Swinburn, a Brit who runs Coors’ U.S. operations and previously headed the troubled U.K. division.
Another possibility is Molson president Kevin Boyce.
Kiely’s replacement will oversee a company that has seen growing volumes in the United States, a stable Canadian market and continued challenges in Europe.
SABMiller and Molson Coors announced the joint venture last October. Each will have a 50% voting interest and five representatives on the board. Miller will have 58% of the economic interest, with Molson Coors gaining the remaining 42%.
Analyst Orin Baranowsky of BMO Capital Markets said the Molson name doesn’t have a significant presence in the United States because advertising promotes Coors.
“I don’t think the average U.S. consumer will notice,” he said in an interview.
