MillerCoors picks Chicago as new headquarters
Windy City called a 'neutral' site for HQ
By David Milstead, Rocky Mountain News (Contact)
Published July 15, 2008 at 4:02 p.m.
Photo by Chris Schneider / The Rocky
MillerCoors CEO Leo Kiely said Tuesday in Denver that the new venture will invest $100 million in the Golden brewery.
Considering the consolidation among major brewers, how might your beer-buying habits change?
The new MillerCoors joint venture has chosen Chicago, not Colorado or Milwaukee, as its new headquarters.
At the same time, it plans $150 million in new investment in its former hometowns, with two-thirds of that slated for the gigantic Golden brewing operation.
"It's the bias for a neutral city that keys the decision," MillerCoors CEO Leo Kiely said Tuesday. "It's really important to form a new culture. Any presumption that anyone came out on top, or somebody won or lost, would really be reinforced if we chose one of the (existing) cities."
MillerCoors' intentions to pick a neutral headquarters city, and that it was leaning to Chicago, were first reported by the Rocky Mountain News in February.
Kiely, who joined the joint venture from Molson Coors, said 150 to 175 positions in each of Golden and Milwaukee will be transferred to Chicago. A specific headquarters site hasn't been chosen, but it will be in downtown Chicago, he said.
The company hopes to have the headquarters open in summer or fall 2009.
Denver- and Montreal-based Molson Coors formed the joint venture July 1 with the English brewer SABMiller.
Each company contributed its American operations, Coors Brewing and Miller Brewing, to the new $6.6 billion (revenue) venture. Thanks to its position as the larger American brewer - it's No. 2 behind Anheuser Busch - SABMiller owns 58 percent of MillerCoors.
Molson Coors, which will retain its Denver headquarters under new CEO Peter Swinburn, owns 42 percent. It will sell Coors and Coors Light in Canada and other international markets, leaving U.S. sales to MillerCoors.
The headquarters news comes a day after Anheuser-Busch's agreement to sell itself to Belgian giant InBev for roughly $50 billion. Kiely demurred from analyzing the sale's implications on MillerCoors, instead saying "the biggest thing we have to do is stay focused on our own game plan."
In addition to putting together "a great team," Kiely says it includes gaining share in light beer, adding above-average growth in superpremium and craft beers, and identifying $500 million in cost-saving synergies from the joint venture.
He could not say Tuesday how many jobs would be cut in the MillerCoors combination. The joint venture combines about 10,000 employees, eight breweries and more than 20 beer brands. Coors employs about 3,000 people in Golden.
Kiely said the new venture will invest $100 million in the Golden brewery and $50 million in Milwaukee, as it prepares to brew legacy Miller and Coors brands in each location. The company will also have a "western division" and an "eastern division" based in Golden and Milwaukee, respectively.
"Our commitment to Golden and Milwaukee is much bigger that it ever will be to Chicago," Kiely said. "It's an emotional decision for both communities, but our commitment goes forward, and it'll be obvious over time."
Kiely said the state of Illinois and city of Chicago put together an incentive package "over the last 36 hours," but he wasn't able to say how much it was.
Tom Clark, director of the Metro Denver Economic Development Corp., said his group submitted a proposal to MillerCoors last week, but "did not hold out much hope."
Colorado did not formally offer incentives because it never entered active negotiations with MillerCoors.
"We knew we were swimming against the current from the beginning," Clark said. "We were in regular contact, and they were always cordial, always friendly, but every conversation ended with 'a neutral site is part of our decision.' "
Kiely said he's talked frequently to the mayors of Denver and Milwaukee and the governors of Colorado and Wisconsin.
"Once we realized a new location was a possibility, we certainly entertained pitches from both cities and states," Kiely said. "But we did not ask them to present economic incentive packages, because that would have been disingenuous."
Kiely and wife Susan will maintain their Denver home as their primary residence, but he will take a Chicago apartment.
Finance editor David Milstead can be reached at milstead@RockyMountainNews.com or 303-954-2648.
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July 15, 2008
4:09 p.m.
Suggest removal
temurlan writes:
"Peter Swinburn, the president and CEO of Coors Brewing, pours a beer in a pour room near his office at the Coors facility in Golden."
Hey everyone, we just lost the HQ...time to party!!!
July 15, 2008
4:12 p.m.
Suggest removal
HolierThanThou writes:
We're cool with that in Colorado, so long as they take the entire Coors family to Chicago as part of the deal.
July 15, 2008
4:17 p.m.
Suggest removal
catlady writes:
How long before we hear "Coors beer brewed with icy cold water from the now nearly mercury free Great Lakes" ???
I'm glad I don't drink or work at Coors. Here's to the unemployment line boys!
July 15, 2008
4:20 p.m.
Suggest removal
Diff writes:
Adolph Coors I am sure is spinning in his grave -
the end of an era - I will never again tour the Coors brewery or drink their product!
July 15, 2008
4:33 p.m.
Suggest removal
Vector049 writes:
Reminds me of the response I received from a Chicago businessman when I asked about the possibility of relocating his company Denver.
His exact words were, "Denver? Denver isn't even on the map."
July 15, 2008
4:36 p.m.
Suggest removal
T1anda writes:
Molsen-Coors now out of stinky ole Chicago. YUK!! I will NEVER buy Coors again!!
July 15, 2008
4:51 p.m.
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Woogford writes:
Coors moves to Chicago and Budweiser moves to Belgium. Hmmmm...guess I'm sticking to microbrew.
July 15, 2008
4:51 p.m.
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Squatch writes:
When I think of Coors I naturally think of Chicago.
July 15, 2008
4:53 p.m.
Suggest removal
buffsblg writes:
this was a forgone conclusion. The combined companies wanted a new start away from each place of origin. However, Chicago is only the executives. Brewing will still take place in Golden. If you like the taste now, you will still like it then.
July 15, 2008
5:11 p.m.
Suggest removal
WarrenJimmyBuffett writes:
How many square feet does the headquarters occupy in Denver?
July 15, 2008
5:29 p.m.
Suggest removal
farsidefan writes:
Coors ! The hometown beer of the Cubbies ! So what do we do with Coors Field now ? How about Fat Tire Stadium ?
July 15, 2008
5:38 p.m.
Suggest removal
pwest writes:
If you think that Chicago doesn't have a romantic brewing history, just watch reruns of the Untouchables!
July 15, 2008
6:01 p.m.
Suggest removal
athought writes:
If Altria owns 28.6% of SABMiller and SABMiller owns 58% of the venture, how much of the venture does Altria (aka Phillip Morris)own? The calculator says 16.6% but then I don't have a degree in high finance. Their HQ is in Virginia so they must not have been the swing vote in the decision.
July 15, 2008
6:44 p.m.
Suggest removal
EZBakeOven writes:
The only thing for certain is change. Remember when people would come to Colorado and stock up on Coors when it wasn't available nationally? My uncle trucked back ten or more cases back to Oregon in the 1970s.
July 15, 2008
6:53 p.m.
Suggest removal
creezee writes:
Now I won't feel guilty sneaking to the end of the tour, skipping directly to the samples. Take that Chicago. Plus, everyone knows the place is actually run by oompa loompas- are they shipping them to Chicago as well?
July 15, 2008
7:07 p.m.
Suggest removal
Brain writes:
Some of you can't read? Coors will still be made in Golden!
July 15, 2008
7:50 p.m.
Suggest removal
The_Punnisher writes:
Miller did the same thing when they ripped off Leinenkugels in Chippewa Falls, WI...The jobs will be next to go...
So much for tradition.....Colorado is going to lose big time...
" Those who do not learn from history are doomed to repeat it "
-Santayana
July 15, 2008
8:07 p.m.
Suggest removal
BMat writes:
HolierThanThou writes:
We're cool with that in Colorado, so long as they take the entire Coors family to Chicago as part of the deal.
__________
Amen Holy, amen.
July 15, 2008
8:20 p.m.
Suggest removal
cabin_fever writes:
Due to lack of oversight and lenient regulations for businesses in Colorado, I stay away from purchasing ANY beer made in this state. Do you wonder why after waking up in the morning you suffer from a huge hangover? Well, check the beer you were drinking from the previous night and if it's made in CO, you'll have your answer. Stringent regulations in others states have breweries monitoring their beers very closely. You never know what you'll get in a CO beer.
July 15, 2008
9:07 p.m.
Suggest removal
Sweetpickle writes:
I guess that solves the union problem in Colorado.
July 16, 2008
6:28 a.m.
Suggest removal
LOUIE writes:
Going to be more mergers and sell offs in a lot of major industries, this economy is going south. It necessary for major industries to restructure and hunker down for the economic winter as it approaches. If they don't they're not going to make it as well or not at all. Sign of the times, only the fittest will survive. Booze, cosmetics, prostitution, drugs, tobbacco, entertainment, churches, these are a few of the industries that fair well in bad times. LOL!
July 16, 2008
6:58 a.m.
Suggest removal
danirobi writes:
Start drinking New Belguim, the beer from them is way better ie. Fat Tire and Skinny Dip.
July 16, 2008
7 a.m.
Suggest removal
Francesca writes:
Look. We attended a Coors service banquet recently in downtown Denver. Pete stood up and spoke about the beer market and how to remain competitive, the company has to adapt and join forces to stay in the business. If you can't bend to change and stay flexible you lose everything. He mentioned the extinct beers, like Olympia for instance. You snooze, you lose.
To those of you that say you'll never buy the product again because of this merger, then you weren't dedicated to the brand anyway. There's plenty of beer out there if that's your thang. There is definitely an association with tradition in Golden and I agree that Chicago doesn't have an appealing ring to it. The brewery is still in Golden. At least this company is keeping as many jobs (you know, production - where the people that produce and package the product keeping this beer afloat) as it possibly can here and who are any of us to complain about that?
Cabin_fever: Hogwash. Maybe you're just drinking too much. Ever think of that?
July 16, 2008
7:09 a.m.
Suggest removal
Hambone writes:
Coors has always been trout piss, that's about it.
July 16, 2008
8:27 a.m.
Suggest removal
Marshdale writes:
It's time to quit drinking beer made by corporate giants. Buy locally produced beer from smaller breweries. What Budweiser has done stinks as well. Remember these are the same people who make huge contributions to so called American loving Republican candidates. Those Republicans really care about American jobs don't they? Just how much do they really love the working people they represent? They don't. All they care about is the corporation. Wake the hell up American worker. You are going to get screwed at every turn by these jack asses.
July 16, 2008
8:39 a.m.
Suggest removal
temurlan writes:
farsidefan,
We move Coors field to east Colfax and name it Easy Street Field.
July 16, 2008
8:42 a.m.
Suggest removal
jaymoveonorg writes:
Democrats do not receive any contributions from corporations? Give me a break. You need to look into removing your foot from your mouth. First, due to the McCain-Feingold campaign finance bill everyone is limited to how much they can contribute to their candidate. If you look into the dollars that have been contributed from CEO's both parties receive a lot of money. Not to mention the amount of money that has been received by moveon.org. The lobbyists own both parties and not just the Republicans. Just wait until Obama increases corporate taxes you will see even more jobs moving away from America.
July 16, 2008
8:52 a.m.
Suggest removal
ChemEng72 writes:
You people who make comments like "Coors beer brewed with icy cold water from the now nearly mercury free Great Lakes" are idiots. The headquarters referred to in this article is where the "white collar" managers work, NOT where the beer is made. Really, you need to do some research before you make stupid comments like that.
And to think my tax dollars paid for your education, what a waste.
July 16, 2008
8:54 a.m.
Suggest removal
temurlan writes:
"MillerCoors CEO Leo Kiely said Tuesday in Denver that the new venture will invest $100 million in the Golden brewery."
How will that affect the product? Will the special barley or hops be switched to save money?
July 16, 2008
9:15 a.m.
Suggest removal
P_Denver writes:
temurlan
The money invested will be to make them able to produce other brands of beer. The current setup is unique for cold-filtered Coors products.
Also, the Coors aluminum can plant (next door to the brewery) will need to be upgraded to make "traditional" size 12-ounce cans (Coors uses a Tall-12, versus the regular beer or soda can) so there will be a lot of money invested here to ensure growth for the future.
July 16, 2008
9:56 a.m.
Suggest removal
Fireball writes:
What about the management employees; Golden/Denver or Chicago? I truly feel sorry for them. My brewery of choice is New Belgium; Fat Tire, Sunshine Wheat, 2 Below and the others. They are one of the best employers in the state and really treat the employees great. And we are rewarded with great beers, a win-win situation for all.
July 16, 2008
11:05 a.m.
Suggest removal
SteveM writes:
Kiely said the state of Illinois and city of Chicago put together an incentive package "over the last 36 hours," but he wasn't able to say how much it was.
It's time for our politicians to step up to the plate and work to keep our companies and our jobs in our state! Illinois/Chicago are masters of attracting HQs. "Denver isn't even on the map," because we don't seem to want to be on the map. We are under the impression that people will move companies here because we are in view of mountains. Well, some do. But most move because they get incentives. Chicago go Boeing because of huge incentives. And we can say these are only white collar jobs, Boeing's factory is still in Seattle, but it doesn't change the prestige factor of having the international HQ of major US iconic brands in your city. There may have been no way to convince Miller to have HQ in Denver, and no way to convince Coors to have HQ in Milwaukee, in this particular case. But, it does illustrate once again our politicos ineffectiveness in preserving local corporate identities. There is no way on earth to imagine Coca-Cola moving out of Atlanta. Coors moving out of Colorado is the virtual equivalent. Sure, the beers may still be brewed here, but the advertising agencies will be selected out of Chicago, the corporate partnerships will be chosen out of Chicago, the next generation of leaders will be plucked out of Chicago. And this is the genius of the Chicago corporate and political structure which we lack entirely. It works the same way in New York City. These people build their white collar elite from the ground up, sort of like building your own baseball players from your own farm system. They educate their people in down town private schools like Latin School of Chicago and Dalton School of New York City or send them to eastern boarding schools like Andover and Exeter. They get their Ivy League degrees, and then they move back to their home cities of NYC and Chicago and become the next generation of power brokers and politicos who are 100% loyal to their hometowns. Move Wrigley Gum or Quaker Oats out of Chicago...not going to happen. There's a lot we need to do to change the corporate and political culture here to ensure that we still have any corporate HQs left in our city.
July 16, 2008
12:25 p.m.
Suggest removal
Marshdale writes:
Jaymove: True, Dems do recieve corporate monies. However it is dishonest to suggest that conservative polititions care as much about the worker as more left leaning candidates. Higher taxes to the common worker is a scare tactic I'm ashamed to say successfully employed by the right. The biggest problem this country faces is the fact that GIANT corporations don't pay any or very few taxes on profits, compared to what was paid as far back as Truman and Eisenhower. The infrastructure in this country, in particular the federal highway system was not built on the backs of the taxes the American worker paid alone. Corporations use the commons as much and if not more than we do and should therfore help pay to rebuild them. Every time you hear the right wing sound machine say the dems are going to raise your taxes its CODE for protecting GIANT corporations. When will my fellow gun toting, beer drinking, meat eating, American worker comrades get it? Come on people. Wake up!
July 16, 2008
3:02 p.m.
Suggest removal
dilligaf writes:
Boy as I read through these comments I kept waiting to see when someone would have to make this a Democrat vs Republican deal. And as stupid has it seems to be someone did it.
July 16, 2008
3:32 p.m.
Suggest removal
cpd writes:
You can kiss the Coors brand goodbye. The $100M will be used to bring the brewery up to code and do cleanup so that it can be sold to a developer. The SAB Miller conglomerate ain't going to waste resources brewing Miller, Molson and Coors brands. They'll consolidate (It's what they call the synergies of the merger). You can bi*** all you want about Coors, the family and union politics, the bottom line is that jobs (read all jobs) ultimately will be gone.
July 16, 2008
3:38 p.m.
Suggest removal
dakar writes:
I like Coors, much better than Bud anyway. I think its sad to see Coors go conglomerate and Colorado is losing another Corp hq. The fact their going to Chicago is even worse.
July 16, 2008
4:34 p.m.
Suggest removal
CoLoradoCitizen writes:
Only "Coors" will be brewed here only. Coors light, it said in an article 2 weekends ago, will now be brewed in multiple breweries across the country to cut down on shipping costs. But who cares? Coors Light, like bud light, is a flavorless awful beer. And coors?........well, too bad about the flavor. Seriously, if you're looking for a brainless beer buzz, buy it.
If you want a great tasting beer, buy Colorado's Best, O'dells and New Belgium. Both Breweries have a fantastic line of beers.
http://www.odells.com/
http://www.newbelgium.com/
July 16, 2008
4:39 p.m.
Suggest removal
CoLoradoCitizen writes:
I drove through chicago a few years ago. Flew in, landed on the west side, drove all the way across to get to Indiana to a funeral. Honestly, I could not believe how dirty the city of chicago is. Trashy, filthy, run-down, over-populated, disgusting. "My kinda town"? GROSS! Denver sparkles in comparison, and Phoenix too. Are all cities east of here that trashy? So they want a dirty over-populated city belching pollution to be their icon for beer? Well, then, they deserve to faiL.