UK: Broker sees SABMiller, Molson Coors trouble ahead
SABMiller has had its share coverage lowered, with potential future problems in its new JV cited as the reason.
ING yesterday (10 October) reduced its rating on the brewer to 'hold' from 'buy', and warned that it saw difficulties getting its proposed merger with Molson Coors in the US past competition authorities.
While there were positives to the deal, announced earlier this week, the future isn't all rosy for SABMiller, ING said.
SABMiller did well avoiding Molson Coors' "difficult" UK position, the broker said, and cost savings in the region of US$290m would lead to a doubling of EBIT margin to around 16%. But ING warned that the two companies may have different agendas, with the two needing to decide on capex and other issues.
This could take time and might give conflicting views, ING noted.
In spite of this, the broker still upped its price target for SABMiller's shares to GBP15.75 from GBP15.00.
The fastest growing beer brand in the US last year was a Belgian-style wheat ale brewed by Molson Coors, according to recent research....
Strong beers may offer brewers significant growth potential but their perception as a cheap way of consuming alcohol puts them directly in the regulatory sights of governments looking to tackle excess...
Asia Pacific Breweries has refused to be drawn on reports that it is in talks to buy a brewer in India....
Cadbury Schweppes has appointed four new members to the board of directors of Dr Pepper Snapple Group, its US beverages subsidiary, including the former Coca-Cola COO Jack Stahl. The other appointment...
SABMiller has appointed an international brand director for its Grolsch beer brand....
Molson Coors Brewing Co. is looking to cut around 4% of its global work force....
Molson Coors Brewing Co. has named its new president, global brand and market development, responsible for "growth and expansion of the company's business and brand portfolios in global markets"....
SABMiller has refuted claims that it is supporting a political campaign in Zimbabwe....
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