Holy Cow! You get on a plane for a few hours and all hell breaks loose. While I was flying to the Great American Beer Festival in Denver, SAB Miller and Molson Coors announced that they will “combine their U.S. operations to create a business that will have annual sales of $6.6 billion and be the second-biggest market player behind Anheuser-Busch.” The new venture will be known as MillerCoors. Wow, that’s big news. I’m sure we’ll hear a lot from business analysts and beer people over the next few days about what this will mean for the beer industry, but for right now I need to digest it all and just drink it in. Wow.
And their beer will still taste like sparkling water with yellow food coloring. ….
There’s no suggestion that SABMiller and Molson Coors, the parent companies of Miller and Coors, are going to merge. They’re simply setting up a joint venture in one market and one market only (the USA) – their operations globally will remain totally separate.
Indeed if you read the detail of the press release, you’ll see that part of the deal includes an agreement between the two that they won’t make a hostile bid for each other’s shares for the next decade. That seems immensely significant to me.
The bigger they get, the more drinkers will become disgusted both with the lack of variety and soulless pursuit of the dollar that they offer. More will seek out what only micros can offer. I’d actually propose that it will be good for our industry.
Brian, I can’t agree with that. This means that instead of three brewers controlling over 80% of the US market, there’ll only really be two. I doubt that will make much of a difference to consumers who are already happy to drink macro lagers. After all, there’ll still be Coors and Millers beers – they’ll just be produced in breweries owned by a single company.
To clarify, I meant good for the micro industry. I also ventur thatg if AB and InBev merge, Heineken merging with SAB/Miller/Coors would be the next logical move.
I doubt this means anything significant for consumers, but it probably means a brewery or three being shuttered over the next several years. That obviously sucks for the men and women that work there. Perhaps, though, such brewery consolidation will provide an opportunity for the bigger “micros”, which aren’t really micros anymore, to expand. I imagine Jim Koch, for one, is eyeing the chance of obtaining another facility.