Molson to invest $35 million in India venture
Molson Coors Brewing Co. (TAP) and Cobra India have joined forces to brew and market Cobra beer in South Asia, an arrangement that will give the brewer a foothold in the fast-growing Asian beer market.
Molson Coors, whose brands include Coors Light, Molson Canadian and Blue Moon, will invest $35 million in the joint venture, Molson Coors Cobra India, giving it a controlling stake in Cobra India and operational control of the new venture. The deal includes land, a 175,000 hectolitre brewery in Bihar state, as well as a beer portfolio consisting of Cobra Premium, King Cobra Superior and Iceberg 9000.
“This deal marks the beginning of a long-term commitment to establish Molson Coors in India, the world’s fastest growing beer market,” said Molson Coors International President Kandy Anand.
Molson Coors said the Indian beer market is estimated to grow to 50 million hectolitres by 2020, landing it in the top 10 list of global beer markets.
Two years ago, Molson Coors UK and Cobra Beer formed a similar joint venture, the Cobra Beer Partnership Ltd., which secured global rights for Cobra beer outside South Asia. The current chairman of that venture, Lord Karan Bilimoria–also Cobra’s founder–will serve as chairman of the new Indian partnership.
Last month, Molson Coors reported lower first-quarter profit amid a year-earlier liability-settlement gain in Brazil. It has aggressively pursued growth in emerging markets, recording a 45% jump in emerging-market sales last quarter.
Source: By Mia Lamar, MarketWatch
Shares of Molson Coors closed Wednesday at $45.22 and were inactive premarket. Year to date, the stock is down 9.9%.