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Tuesday 09 October, 2007


Joint Venture

09 October 2007


   •Combination of complementary assets will create a stronger, more
    competitive U.S. brewer with an enhanced brand portfolio

   •Greater scale and resources will allow additional investment in brands,
    product innovation and sales execution

   •Consumers and retailers will benefit from greater choice and access to

   •Distributors will benefit from a superior core brand portfolio,
    simplified systems, lower operating costs and improved chain account

   •$500 million of annual cost synergies will enhance financial performance

   •SABMiller and Molson Coors with 50%/50% voting interest and 58%/42%
    economic interest

9 October 2007 (London and Denver) -- SABMiller plc (SAB.L) and Molson Coors
Brewing Company (NYSE: TAP; TSX) today announced that they have signed a letter
of intent to combine the U.S. and Puerto Rico operations of their respective
subsidiaries, Miller and Coors, in a joint venture to create a stronger,
brand-led U.S. brewer with the scale, resources and distribution platform to
compete more effectively in the increasingly competitive U.S. marketplace.

The new company, which will be called MillerCoors, will have annual pro forma
combined beer sales of 69 million U.S. barrels (81 million hectoliters) and net
revenues of approximately $6.6 billion. Pro forma combined EBITDA will be
approximately $842 million(1). SABMiller and Molson Coors expect the transaction
to generate approximately $500 million in annual cost synergies to be delivered
in full by the third full financial year of combined operations. The transaction
is expected to be earnings accretive to both companies in the second full
financial year of combined operations. Closing of the transaction is subject to
reaching final agreement, obtaining clearance from U.S. competition authorities,
certain other regulatory clearances and third-party consents, as required.

SABMiller and Molson Coors will each have a 50% voting interest in the joint
venture and have five representatives each on its Board of Directors. Based on
the economic value of the contributed assets, SABMiller will have a 58% economic
interest in the joint venture and Molson Coors will have a 42% economic

Pete Coors, Vice Chairman of Molson Coors, will serve as Chairman of
MillerCoors. Graham Mackay, SABMiller CEO, will serve as Vice Chairman of
MillerCoors. Leo Kiely, current CEO of Molson Coors, will be the CEO of the
joint venture, and Tom Long, current CEO of Miller, will be appointed President
and Chief Commercial Officer.

Commenting on the transaction, Graham Mackay, Chief Executive of SABMiller,
said, 'We are excited by the enhanced prospects for growth and the considerable
benefits to all stakeholders that this joint venture offers. Given the highly
complementary nature of our U.S. assets, operations and geographic footprint,
this is a logical and compelling combination that we expect will create
significant value for shareholders while benefiting distributors, consumers,
retailers and the market overall. We look forward to working with Molson Coors
to jointly develop the combined business.'

Pete Coors, Vice Chairman of Molson Coors, said, 'This transaction is driven by
the profound changes in the U.S. alcohol beverage industry that are confronting
both of our companies with new challenges. Consumers are broadening their tastes
and are increasingly looking for greater choice and differentiation; wine and
spirits companies are encroaching on traditional beer occasions, and global beer
importers and craft brewers are both taking a larger share of volume and profit
growth. Creating a stronger U.S. brewer will help us meet these challenges,
compete more effectively and provide U.S. consumers with more choice, greater
product availability and increased innovation. The Molson and Coors families are
firmly in support of this strategic transaction.'

Leo Kiely, Chief Executive of Molson Coors, said, 'As a result of this
combination, Miller and Coors will be able to provide more focused support for
our flagship brands, while taking full advantage of consumers' demand for
imported and craft brands and innovative products. Both companies have a lot of
momentum in their businesses today, and I am confident that this will accelerate
as we adopt the best practices of both organizations. I am delighted to have the
opportunity to be part of such a dynamic team that will mesh truly great brewing
traditions, management teams, employees and cultures, while retaining both
companies' commitment to social responsibility and the communities in which we

Tom Long, Chief Executive and President of Miller, said, 'Many important
stakeholders will see clear benefits from the new company. Distributors will
benefit from a robust brand portfolio, strengthened marketing investments,
reduced complexity and costs, and enhanced relationships and coverage with large
chain retailers. Retail customers will have an even stronger partner to drive
consumer demand through product and packaging innovation, space optimization and
enhanced retail execution. Our employees will have the opportunity to work for a
stronger and more competitive player in the U.S. beer industry. And the
communities where we do business will see a faster growing enterprise providing
important economic benefits.'

     Transaction Rationale - Creation of a Stronger, Brand Led U.S. Brewer

SABMiller and Molson Coors expect that the enhanced brand portfolio, scale and
combined management strength of the joint venture will allow it to better
compete in the highly competitive and changing U.S marketplace and thus improve
the standalone operational and financial performance of both Miller and Coors

•    Building a Stronger Brand Portfolio and Giving Consumers More Choice
     The  combined  company will have a more  complete  and  differentiated
     brand portfolio and the ability to invest more effectively in marketing its
     brands to  consumers.  MillerCoors  will build on the unique  attributes of
     both Miller Lite and Coors Light to ensure compelling differentiation.  The
     new company will also be better positioned to meet the increasingly diverse
     demands of U.S.  beverage  alcohol  consumers  through imports like Peroni,
     Molson and Pilsner Urquell; craft varieties including  Leinenkugel's,  Blue
     Moon and Henry Weinhard's; and specialty beers like Miller Chill, Killian's
     and  Sparks.  MillerCoors  will have more  flexibility  and  resources  for
     brand-building  initiatives  and  increased  levels of innovation in taste,
     product attributes and packaging.

•    Capturing Synergies and Improving Productivity
     The  combination of the businesses is expected to result in identified
     annual  cost  synergies  of $500  million,  to come  from  optimization  of
     production over the existing brewery network,  reduced shipping  distances,
     economies of scale in brewery operations and the elimination of duplication
     in corporate and marketing  services.  The expected timing of the synergies
     is $50 million in the first full financial year of combined operations;  an
     additional annualized $350 million in Year Two; and another annualized $100
     million  in Year Three - for an  aggregate  annual  total of $500  million.
     One-time cash outlays  required to achieve these  synergies are expected to
     amount to a net $450  million  consisting  of costs of  approximately  $230
     million and net capital expenditure of approximately $220 million.

•    Creating a More Effective Competitor
     This  deal  will  create  a  stronger  U.S.  brewer  with  the  scale,
     operational   efficiency   and   distribution   platform  to  compete  more
     effectively  in the U.S.  against  large scale  brewers,  both domestic and
     global,  craft brewers,  and wine and spirits producers.  The joint venture
     will  be  positioned  to  respond  more  effectively  to  the  needs  of  a
     consolidating  distributor  and  retailer  market,  as well as to the  cost
     pressures in the industry.

•    Improving the Route to Market and Benefiting Distributors and Retailers
     By leveraging  complementary  geographic  strengths  and  distribution
     systems,  the joint  venture will be able to better align  production  with
     consumer location.  Today,  approximately 60% of the volume of the combined
     operation is estimated to go through a shared distribution  system, and the
     companies  have found  that this has  enhanced  distributor  effectiveness.
     MillerCoors  will also have greater  capacity to invest to meet the diverse
     product,  packaging  and service  requirements  of  increasingly  demanding
     consumers,  distributors  and the retail  trade.  In addition,  streamlined
     processes and systems and more  effective  marketing  programs will enhance
     distributors'  ability to  compete  and  benefit  retailers.  o  Optimizing
     Organizational  Strength  The  joint  venture  will  focus  on  creating  a
     high-performing,  results and value-based  culture which will take the best
     elements of both companies to create a competitive organization, capable of
     the  highest  standards  of  operational  and  service  excellence  in  the
     industry.  The joint venture will continue to comply with all provisions of
     existing labor agreements.

                             Approval Process and Timetable

The transaction is subject to reaching final agreement, which is expected by the
end of 2007. Closing of the transaction is also subject to obtaining clearances
from the U.S. competition authorities and certain other regulatory clearances
and third-party consents as required. The transaction will require the approval
of a majority of Molson Coors' Class A common and exchangeable shareholders,
which is expected to be given at the time of signing the definitive agreements
from the Molson and Coors families, who own a majority of such shares. The
transaction does not otherwise require approval by the shareholders of either
party. The Miller business and the Coors business will be conducted separately
and in the ordinary course between signing and completion.

                        Financial and Other Information

•  Financial information

                   Miller(1)                  Coors(2)             Pro forma
                 For the year    For the four fiscal quarters      combined
                    ended                   ended
                31 March 2007            1 April 2007

 Net revenue              3.9                  2.7                     6.6
  EBITDA $m               484                  358                     842
   EBIT $m                342(3)               241                     583

(1) As reported under IFRS excluding the international segment

(2) As reported under US GAAP, excluding special items

(3) Represents the North American segmental EBITA per the annual financial
statements less amortization of $9 million and EBIT of $24 million attributable
to the international segment.

The partners currently plan to retain leverage outside the joint venture,
supported by strong cash flow generation. Therefore, the combined business will
have a strong balance sheet. Cash distributions to the partners and cash flow
injections from the partners will be undertaken pro rata to the partners'
economic interests.

•    Financial effects on SABMiller and Molson Coors
     On a pro forma basis,  the  transaction is expected to be accretive to
     earnings per share,  after  synergies and synergy  capture costs,  for both
     partners  in the joint  venture's  second full  financial  year of combined
     operation. The transaction has been undertaken as a merger of equals and is
     expected to deliver substantial synergies,  and therefore the SABMiller and
     Molson Coors Boards  expect that the  transaction  will  generate  positive
     value and economic profit for each partner  respectively in the second full
     financial year of combination.

•    Financial reporting
     The partners will coordinate their financial  reporting to ensure that
     both companies'  shareholders  receive the same  information in relation to
     the joint venture at the same time.

                 Management and Governance of the Joint Venture

In addition to the appointments of the CEO and the President and CCO of
MillerCoors announced above, as part of the integration planning process, the
parties will draw the senior management team of the joint venture wherever
possible from existing members of the executive teams of Miller and Coors. The
parties have also agreed to a process for subsequent CEO selection which will
emphasize, to the extent possible, succession planning from within the joint

                          Structure of the Transaction

The joint venture will be effected through the contribution by both parties of
their U.S. and Puerto Rico operations into a limited liability company to be
formed under Delaware law. Each of the parties has agreed that all its U.S.
business will be conducted exclusively through the joint venture.

The international operations of Miller and Coors will not be contributed to the
joint venture and will be managed separately by the respective companies. The
parties will agree to appropriate brand management arrangements to protect the
cross border integrity of brands in different territories. The parties will
enter into appropriate contract brewing and service arrangements with the joint
venture for the production of these brands for export to markets outside the
U.S. and Puerto Rico(2).

SABMiller and Molson Coors will enter into a mutual standstill agreement which
will prevent SABMiller and Molson Coors from making an unsolicited offer for the
shares of the other party for a period of 10 years following completion of the

The parties have agreed to appropriate rights of first offer and last refusal in
the event of either party wanting to sell its interest in the joint venture
after an initial no sale period of 5 years.

If definitive agreements are not signed because a third party proposes a
competing transaction, then if either company agrees before 31 December 2008 to
implement a competing transaction, that company will pay to the other a break-up
fee of $150 million.

Overview of SABMiller

SABMiller plc is one of the world's largest brewers with brewing interests or
distribution agreements in over 60 countries across six continents. The group's
brands include premium international beers such as Miller Genuine Draft, Peroni
Nastro Azzurro and Pilsner Urquell, as well as an exceptional range of market
leading local brands.  Outside the USA, SABMiller plc is also one of the largest
bottlers of Coca-Cola products in the world. In the year ended 31 March 2007,
the group reported $3,154 million adjusted pre-tax profit and revenue of $18,620
million. SABMiller plc is listed on the London and Johannesburg stock exchanges.

For more information on SABMiller plc, visit the company's website:

Overview of Molson Coors

Molson Coors is one of the world's leading brewers. It brews, markets and sells
a portfolio of premium quality brands such as Coors Light, Molson Canadian,
Molson Dry, Carling, Coors, and Keystone Light. It operates in Canada, through
Molson Canada; in the U.S., through Coors Brewing Company; in the UK, Europe and
Asia, through Coors Brewers Limited. For more information on Molson Coors
Brewing Company, visit the company's website,

Overview of Miller

Miller produces, markets and sells the Miller portfolio of brands in the U.S.
The Miller business to be contributed to the joint venture (the 'Miller
Business') does not include the sales of Miller brands outside the U.S., but
does include the sale of other SABMiller brands in the U.S.

Financial information

The Miller Business' net revenue, EBIT and EBITDA for the year ended 31 March
2007 under IFRS were $3.9 billion, $342 million and $484 million, respectively.

As at 31 March 2007, the Miller Business had gross assets of not more than $6.1
billion on an IFRS basis.

Overview of Coors

Coors produces, markets and sells the Coors portfolio of brands in the U.S. and
Puerto Rico, which is managed as an integral part of the U.S. business, and also
holds 50% interests in the Rocky Mountain Metal Corporation and Rocky Mountain
Bottle Corporation joint ventures. The Coors business to be contributed to the
joint venture (the 'Coors Business') will not include the sales of Coors brands
outside the U.S. and Puerto Rico. The business to be contributed does include
the sale of other Molson Coors brands in the U.S. and Puerto Rico.

Financial information

The Coors Business' net revenue, EBIT and EBITDA for the four fiscal quarters
ended 1 April 2007 under US GAAP were $2.7 billion, $241 million and $358
million, respectively. At 31 December 2006, the U.S. segment of Molson Coors
Brewing Company reported gross assets of $2.6 billion on a U.S. GAAP basis.

Financial Community Meeting and Webcast

The companies will host a financial community meeting and webcast today at 10:00
a.m. EDT to discuss the joint venture. The meeting will be located at The New
York Palace Hotel, 455 Madison Avenue, New York, New York. The live video
webcast, a slide presentation and the archived video webcast will be available
at and

Press are invited to attend, view the video webcast or download the meeting
footage and b-roll using the following analog downlink information:

          Time: 9:50 a.m. (ET)
          Satellite: Galaxy 11
          Transponder: KU 20
          Downlink Frequency: 12100.0 Vertical

This announcement is for information only and does not constitute an offer or an
invitation to acquire or dispose of any securities or investment advice or an
inducement to enter into investment activity. This announcement does not
constitute an offer to sell or issue or the solicitation of an offer to buy or
acquire the securities of SABMiller or Molson Coors (the 'Companies') in any

The distribution of this announcement may be restricted by law. Persons into
whose possession this announcement comes are required by the Companies to inform
themselves about and to observe any such restrictions.

Forward-Looking Statements

This press release includes 'forward-looking statements' within the meaning of
the U.S. federal securities laws, and language indicating trends, such
as 'anticipated' and 'expected'. It also includes financial information, of
which, as of the date of this press release, the Companies' independent auditors
have not completed their review.  Although the Companies believe that the
assumptions upon which their respective financial information and
their respective forward-looking statements are based are reasonable, they can
give no assurance that these assumptions will prove to be correct. Important
factors that could cause actual results to differ materially from the Companies'
projections and expectations are disclosed in Molson Coors' filings with the
Securities and Exchange Commission and in SABMiller's annual report and accounts
for the year ended 31 March 2007 and in other documents which are available on
SABMiller's website at These factors include, among others,
changes in consumer preferences and product trends; price discounting by major
competitors; failure to realize anticipated results from synergy initiatives;
 failure to obtain regulatory consents or other third party approvals; 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. Neither SABMiller nor Molson Coors undertakes to
update forward-looking statements relating to their respective businesses,
whether as a result of new information, future events or otherwise.  Neither
SABMiller nor Molson Coors accepts any responsibility for any financial
information contained in this press release relating to the business or
operations or results or financial condition of the other or their respective

                                     # # #


For further information, please contact:

SABMiller / Miller                           Tel: +44 20 7659 0100/ 414 931 2000

Nigel Fairbrass       Media Relations, SABMiller            Mob: +44 7799 894265
Pete Marino           Media Relations, Miller               Mob: 312/339-8833
Gary Leibowitz        Investor Relations, SABMiller         Mob: +44 7717 428540

Molson Coors / Coors

Kabira Hatland        Media Relations, Molson Coors         303/277-2555
Paul de la Plante     Media Relations, Molson Coors         303/277-2555
Dave Dunnewald        Investor Relations, Molson Coors      303/279-6565

Sard Verbinnen & Co

Drew Brown             Media Relations                      212/687-8080
Jim Barron             Media Relations                      212/687-8080
Carrie Bloom           Media Relations                      Mob: 516/816-5662


(1) Figures are based on Miller's net revenue and earnings before interest,
taxes, depreciation and amortization (EBITDA) in the U.S. and Puerto Rico for
the year ended 31 March 2007, which under IFRS were $3.9 billion and $484
million respectively. Net revenue and EBITDA excluding special items for Molson
Coors' U.S. segment for the four fiscal quarters ended 1 April 2007 under US
GAAP were $2.7 billion and $358 million respectively.

(2) Estimated net revenue, EBITDA and EBIT on a reported basis for Miller's
international operations outside the U.S. and Puerto Rico for the year ended 31
March 2007 were $91.2 million, $26.4 million and $24.4 million respectively.
Coors' net revenue and EBITDA outside the U.S. and Puerto Rico for the four
fiscal quarters ended 1 April 2007 were not material.

                      This information is provided by RNS
            The company news service from the London Stock Exchange

a d v e r t i s e m e n t