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5 Years Later, MillerCoors Partnership Doing Well

Mon, 07/01/2013 - 11:06am

MILWAUKEE (AP) -- The MillerCoors partnership is now five years old, and even though the headquarters of the joint venture between Miller Brewing and Coors Brewing Co. has shifted to Chicago, Miller's presence in Milwaukee remains strong.

The two companies merged five years ago Monday. But the Milwaukee Brewers still play at Miller Park, about a mile or so from where Frederick Miller launched the business nearly 160 years ago, and Miller Lite continues to sponsor a number of prominent community events.

The number of brewery employees in the city also hasn't changed since the merger, the Milwaukee Journal Sentinel reported (http://bit.ly/15YjDbF ). There are about 40 percent fewer office workers, as jobs shifted from Milwaukee to the new headquarters in Chicago, but a new project to upgrade technology will bring another 240 jobs to Milwaukee in the next year or so.

"The brewery is very busy," said Andy Moschea, brewery plant manager in Milwaukee. The facility also does contract brewing of beers including Schlitz and Pabst.

Analysts say the merger has lived up to executives' predictions of significant cost savings. Since the companies partnered up on July 1, 2008, MillerCoors has saved nearly $900 million through lower production and administrative costs.

The savings have come at a time when MillerCoors has seen its sales volume fall 6 percent. The company is trying to sell mainstream brands such as Coors Light, Miller Lite and Miller High Life in a world where craft beers are gaining popularity.

Even so, the company remains profitable. Annual net income has risen 37 percent, from $892 million in 2009 to $1.22 billion last year, partly because of the cost savings and because beer prices have gone up.

There are still growing challenges to tackle, especially a declining popularity of Miller Lite, Miller High Life, Miller Genuine Draft and Milwaukee's Best. MillerCoors had 27.6 percent of the nation's beer market at the end of last year, which was down from 29.5 percent in 2008, according to trade publication Beer Marketers Insights.

"The whole Miller legacy has really struggled," publisher Benj Steinman said.

On the plus side, MillerCoors is seeing higher sales of craft and specialty beers, through both the Blue Moon and Leinenkugel's labels, as well as new brands that include Redd's Apple Ale and Third Shift Amber Lager.

At its offices in downtown Milwaukee, MillerCoors has 607 employees. That's more than the 592 workers in Golden, Colo., where Coors Brewing was based, and the 445 in Chicago.

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