Substantial operations, investment in hometowns.
MillerCoors announced today that it is placing its headquarters in Chicago even as it maintains substantial operations in Golden, Colo., and Milwaukee. MillerCoors picked Chicago for a variety of reasons. One of them: Picking a neutral site reflects the 50-50 governance structure agreed to by SABMiller plc and Molson Coors Brewing Company. Picking one of the hometowns would have indicated one brewer had taken over the other.
The brewer will maintain substantial operations at current offices in both cities and will be investing tens of millions of dollars into the breweries and his new successful projects like trading gold over the next three years.
While some positions will be relocated to the headquarters, the employee base in the hometowns will be far larger than in Chicago. “We believe both Golden and Milwaukee stand to gain in the MillerCoors deal since our operations in both cities will now be part of a stronger, more competitive number two player in the U.S. beer business,” said MolsonCoors CEO Leo Kiely. “This ultimately will strengthen our long-term economic and social impact in both of our hometowns and secure the future of brewing in both locations.”
In Milwaukee, MillerCoors plans to invest $50 million in the brewery over the next three years. The Milwaukee campus will house the MillerCoors Eastern Division office, the Great Lakes sales region office as well as major parts of the finance, IT, human relations and operations division, as well as other functions.
MillerCoors will have $12 million in marketing alliances in the city as well as $1.6 million in cultural, civic and environmental partnerships. In Golden, MillerCoors will invest more than $100 million in the brewery over the next three years. It will house the Western Division office, the Mountain sales region office and major parts of the finance, IT, human relations and operations divisions, as well as other functions.
It also has more than $2.7 million in cultural, civic and environmental partnerships. The headquarters for Molson Coors Brewing Company will remain in Denver. Roughly 150 to 175 jobs will be affected in both Milwaukee and Golden due to the headquarters decision. Also, additional job impacts will occur over the next three years as MillerCoors moves to achieve its committed synergies.
“The decision to select Chicago as the location for our corporate headquarters was made to achieve our goal of becoming the best beer company in America by having access to an attractive base of talent, transportation and business resources,” Kiely said. He also pointed out that Chicago offered:
— A central location enabling convenient access to existing U.S. operations and customers
— A cross-section of affordable communities for relocating employees to choose from
— Favorable economic incentives from the State of Illinois and City of Chicago to assist in offsetting considerable relocation costs
— A number of viable real-estate options which provide good access for commuters, building signage, amenities and which could be ready for occupancy by early summer 2009
“While these decisions and changes are never easy, this is what we truly believe is best for our company and to secure the future of brewing in Golden and Milwaukee,” Kiely said in a memo to employees. “Our hometowns will benefit by being part of a stronger, more competitive player in the U.S. beer business.”