In a Proposed Deal with Brewer Miller, Molson Coors Could Shine
Molson Coors (TAP) - Get Report foresees a bright future in its expected tie-up with Miller.
The Denver-based brewer unveiled this week a look into the projected scope of the combined company, once it buys the 58% stake in MillerCoors, which it doesn't already own, in a joint venture from rival SABMiller of London.
Molson's $12 billion bid to acquire the remaining stake in Chicago's MillerCoors was announced simultaneously with Anheuser-Busch's (BUD) - Get Report $106 billion deal to acquire SABMiller, and the purchase is contingent on Anheuser-Busch's deal obtaining regulatory approval.
Molson Coors is a member of Real Money's "Vice Squad" watch list, as well as Diageo (DEO) - Get Report and Constellation Brands (STZ) - Get Report .
In an SEC filing Thursday, Molson Coors said the combined company is expected to rake in sales of nearly $14 billion pro forma the acquisition, up from just $5.1 billion at Molson alone. Meanwhile, net income is projected to climb by about 29% from last year at Molson to roughly $461 million.
The combined brewing giant is also expected to take on a nearly $6 billion debt load, up from just under $3 billion at Molson Coors independently, while total liabilities will more than triple to $18 billion.
Molson CEO Mark Hunter has said the combined brewing giant is expected to seize a substantial new stake in the global beer market through a broadened brand portfolio and international reach.
"This transaction is a game-changing opportunity for Molson Coors and advances our ambition to be the first choice for consumers and customers," he said in a news release. "In consolidating ownership of MillerCoors, we will strengthen our presence in the highly attractive U.S. beer market, further improve our global scale and agility, benefit from significantly enhanced cash flows, and capture substantial operational synergies," he added.
