Exhibit 99.1
MOLSON COORS SELLS CONTROLLING STAKE IN BRAZIL OPERATIONS TO FEMSA,
ANNOUNCES FOURTH QUARTER BUSINESS TRENDS
MONTREAL and DENVER, Jan. 16 /PRNewswire-FirstCall/ -- Molson Coors Brewing
Company (NYSE: TAP; TSX) announced that it today sold a 68 percent equity
interest in its Brazilian unit, Cervejarias Kaiser ("Kaiser"), to FEMSA Cerveza
S.A. de C.V. ("FEMSA") for US$68 million cash, including the assumption by FEMSA
of certain Kaiser-related debt and contingencies.
Following the transaction, Molson Coors will own 15 percent of Kaiser and
have one seat on its board. Heineken NV remains a 17 percent equity partner in
the Kaiser business.
"Last year, we committed to a strategic review of our Brazilian business. We
made good on that commitment, and this transaction is the result," said Leo
Kiely, President and CEO of Molson Coors. "The transaction allows us to focus on
our biggest markets and to continue to deliver the cost synergies and other
benefits related to the Molson Coors merger. It also represents a winning
proposition for Kaiser in Brazil, as it further aligns branding, production,
selling and distribution operations." FEMSA owns the largest distributor of
Kaiser products in Brazil.
Kiely added, "We believe this partnership with FEMSA will strengthen
Kaiser's overall position in the Brazilian market. By maintaining a minority
ownership interest and the possibility of launching Coors Light in Brazil, we
expect to continue to participate in the upside we see in the Kaiser business
and the Brazilian beer market."
Kaiser financial debt totaled approximately US$60 million at closing. While
Molson Coors believes that all significant contingencies have been disclosed as
part of the sale process and adequately reserved for on the Kaiser financial
statements, resolution of contingencies and claims above reserved or otherwise
disclosed amounts could, under some circumstances, result in additional
liabilities for Molson Coors because of transaction- related indemnity
provisions.
Molson Coors intends to report Kaiser results for the fourth quarter and
full year of 2005 as discontinued operations in its financial statements.
Following this transaction, Molson Coors intends to report its interest in
Kaiser in its financial statements using cost-method accounting.
J.P. Morgan Securities Inc. acted as exclusive financial advisor to Molson
Coors and provided a fairness opinion in relation to the transaction.
Fourth Quarter Business Trends
Separately, Molson Coors Brewing Company announced that it expects to report
lower consolidated sales volume and earnings per share, excluding special items,
for the fourth quarter of 2005 versus the comparable pro forma fourth quarter of
2004. Although financial results have not been compiled yet for the 13-week
fourth quarter ended December 25, 2005, the company expects lower earnings
primarily due to higher costs, difficult industry pricing in key markets and
non-recurring factors.
Consolidated fourth quarter 2005 sales volume declined approximately 2
percent, and consolidated sales to retail decreased about 1-1/2 percent versus
the pro forma fourth quarter of 2004. Canada segment sales to retail were
virtually unchanged compared to the pro forma period a year ago, while sales
volume increased slightly versus prior year. In particular, Coors Light sales to
retail in Canada continued to grow at a double-digit rate. Comparable fourth
quarter U.S. sales volume to wholesalers was virtually unchanged, while sales to
retail grew approximately 1 percent versus a year earlier, driven by
low-single-digit growth of Coors Light. Europe segment sales to retail decreased
about 3-1/2 percent compared to a year ago, while Brazil sales to retail
declined approximately 7 percent on a comparable basis versus a year ago.
The company generally does not release any financial information prior to an
earnings release for the relevant period but is disclosing the above information
in connection with the disclosure regarding the sale of its Brazil operations.
Additional financial information will be available with Molson Coors Brewing
Company's fourth quarter 2005 earnings release, scheduled for Feb. 9, 2006. The
company will conduct an earnings conference call with financial analysts and
investors at noon Eastern Time on this date to discuss the company's 2005 fourth
quarter financial results.
Molson Coors Brewing Company is the fifth-largest brewer in the world. It
sells its products in North America, Europe, Latin America and Asia. Molson
Coors is the leading brewer in Canada, the second-largest in the U.K., and the
third-largest in the U.S. The company's brands include Coors Light, Molson
Canadian, Molson Dry, Carling, Coors and Keystone. For more information on
Molson Coors, visit the company's website, www.molsoncoors.com.
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning
of the federal securities laws, commonly identified by such terms as
"possibility," "believe," "anticipates," and "expects," and other terms with
similar meaning indicating possible future events or actions or potential impact
on the business of the Company. It also includes financial information of which,
as of the date of this press release, the Company's independent auditors have
not completed their review. Although the Company believes that the assumptions
upon which the financial information and its forward-looking statements are
based are reasonable, it can give no assurance that these assumptions will prove
to be correct. Important factors that could cause actual results to differ
materially from the company's projections and expectations are disclosed in the
company's filings with the Securities and Exchange Commission. These factors
include, among others, changes in consumer preferences and product trends; price
discounting by major competitors; unanticipated expenses, margin impact and
other factors resulting from the recent merger; failure to realize anticipated
results from synergy initiatives; and increases in costs generally. All
forward-looking statements in this press release are expressly qualified by such
cautionary statements and by reference to the underlying assumptions. We do not
undertake to publicly update forward-looking statements, whether as a result of
new information, future events or otherwise.
SOURCE Molson Coors Brewing Company
-0- 01/16/2006
/CONTACT: Media, Sylvia Morin, +1-514-590-6345, or Investors, Dave
Dunnewald, +1-303-279-6565, or Kevin Caulfield, +1-303-277-6894, all of Molson
Coors Brewing Company/
/Web site: http://www.molsoncoors.com /
(TAP TAP.)
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