And then there were two.
The Big Three of American brewing with become the Big Two. Brewers Molson Coors Brewing Co. and SABMiller said today they will combine their U.S. operations in a joint venture.
The makers of Miller Lite, Original Coors and Coors Light said they will share ownership equally in the new venture, but because of the economic value of their respective units SABMiller will have a 58% economic interest to Molson Coors’s 42% interest. The deal is expected to close by the end of he year.
Miller is the second largest brewing company in America and Molson Coors the third, both well behind Anheuser-Busch. Even combined they will still be smaller than A-B.
SABMiller and Molson Coors said they expect the combined brand portfolio, scale and combined management strength of the joint venture will allow it to better compete in the U.S marketplace, improving the standalone operational and financial performance of both Miller and Coors.
“This transaction is driven by the profound changes in the U.S. alcohol beverage industry that are confronting both of our companies with new challenges,” said Molson Coors Vice Chairman Pete Coors.
“Consumers are broadening their tastes and are increasingly looking for greater choice and differentiation; wine and spirits companies are encroaching on traditional beer occasions, and global beer importers and craft brewers are both taking a larger share of volume and profit growth. Creating a stronger U.S. brewer will help us meet these challenges, compete more effectively and provide U.S. consumers with more choice, greater product availability and increased innovation. The Molson and Coors families are firmly in support of this strategic transaction.”