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Canada, Montreal: Shareholders of Molson Inc., Canada's biggest brewer, voted overwhelmingly in favour of a plan to merge with U.S.-based Adolph Coors Co. at a special meeting held in Montreal on Friday, 28 January 2005. The merger, which won the favour of 80.2% of Molson class A shareholders and 84.3% of its class B shareholders, would create the world's fifth-largest brewer by volume.
Molson Chairman Eric Molson said the vote represented overwhelming support from shareholders. "Molson management and the board are very pleased that the shareholders have supported the merger and understood the strategic and economic value of this transaction," he told the meeting. Molson added that the merger would allow the combined company to compete in the rapidly consolidating global beer market. "This transaction marks a new and important chapter in Molson's history," said Eric H. Molson, chairman of Molson. "This merger builds on the strategic and cultural fit between our two companies and creates a global brewer with the operating scale, resources and geographic coverage necessary to compete in today's consolidating brewing industry." "This has been a long process and I am thankful that our shareholders have supported us and have understood the strategic and economic value of this transaction."
Molson's Class A shares were up 80 Canadian cents at C$39.15 on the Toronto Stock Exchange shortly after the opening of trade on Friday. Coors shares were up $1.36 or 1.8 percent at $76.25 on the New York Stock Exchange.
Molson shareholders will own 55 percent of the combined company, with the Molson and Coors families sharing voting power. Coors Chief Executive Leo Kiely and chief financial officer Tim Wolf will keep those posts at the merged company.
The proposed merger requires the approval of Adolph Coors Company stockholders scheduled for February 1, 2005, in Golden Colorado.
As previously announced, the approved merger will be submitted to the Quйbec Superior Court for a final order or approval on February 2nd, 2005 and the closing of the transaction is planned for February 9, 2005. The Molson Coors stock is expected to start trading on the TSX and the NYSE on February 9th, 2005. Registered Molson shareholders at the close of business on the day preceding the closing will be entitled to receive the $5.44 special dividend as part of the approved transaction.
Together, Molson Inc. and Adolph Coors Company will form the fifth largest brewer in the world, with combined volume of 60 million hl and proforma net sales of US$6 billion. The brewer will have a market capitalization of US$6 billion and a position of strength to become a future consolidator in the global brewing industry. It will have leading market share in Canada and in the U.K. a growth market in the U.S. and an emerging market in Brazil as well as a portfolio of well established brands such as Molson Canadian, Coors Light and Carling and other brands including Keystone, Aspen Edge, Zima, as well as Molson Ultra, Export, Molson Dry, Rickard's and Kaiser. Founded by pioneering families who are still active in the business and have deep roots in their respective countries, Molson Coors Brewing Company will have over 350 combined years of brewing excellence, 15 breweries and 14,800 employees in 4 countries.
Molson Inc. is Canada's leading beer company and one of the world's largest brewers of quality beer with $3.5 billion in gross annual sales, over $500 million in pre-tax profit and an investment grade financial profile. Committed to shareholder returns, Molson has delivered superior share performance among peer brewers over the past five years. A global company with 13 breweries and 3 100 employees in Canada, Brazil and the United States, Molson traces its roots back to 1786 making it North America's oldest beer brand. Committed to brewing excellence, Molson combines the finest natural ingredients with the highest standards of quality to produce an award-winning portfolio of beers including Molson Canadian, Molson Export, Molson Dry, Rickard's, Marca Bavaria, Kaiser and Bavaria.
The approval means Ian Molson failed in his attempt to block the deal. Ian Molson, 49, the company's former deputy chairman and a cousin of Chairman Eric Molson, said on January 11 he opposed the merger because it was ``in effect a Coors takeover of Molson, with no premium being paid to Molson shareholders.'' Ian Molson owns 2.3 million Class B shares, or about 11 percent of the voting stock. After the merger proposal was announced in July he said he was trying to arrange a rival bid for Molson valued at about C$40 a share.
History:
The merger unites two of North America's most storied companies. Englishman John Molson founded Molson on the banks of the St. Lawrence River in 1786, going on to build Canada's first steamboat and starting a bank that grew to 125 branches by the time it was acquired in 1925.
Adolph Coors arrived in Baltimore in 1868 as a 21-year-old stowaway fleeing war in Germany. He headed west and landed in Denver, where he bought a bottling company in 1872. A year later, he co-founded ``The Golden Brewery'' in Golden, Colorado, becoming its sole owner in 1880. Adolph Coors Co. became the official company name in 1913.
The merger is the largest involving a Canadian company since the C$13.9 billion takeover of John Hancock Financial Services by Manulife Financial Corp., announced in September, 2003. Bank of Montreal and Citigroup Inc. advised Molson on the merger, while Merrill Lynch & Co. was a financial adviser to a special committee of Molson's independent directors. Deutsche Bank AG and Toronto-Dominion's TD Securities advised Coors.
30 January, 2005
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