CANADA: Molson to close strike-affected brewery

By | 1 August 2007

Molson Canada is set to close one of its breweries in the country.

The Canadian arm of Molson Coors confirmed yesterday (31 July) that the Edmonton brewery, located in the state of Alberta, will close at the end of this month, leading to the loss of 136 employees. The site, which is a bottling facility, has been at the centre of a strike by workers since May. Molson conceded that the strike had contributed to its decision to close the facility.

"Clearly, the two business conditions with the greatest influence (on the decision to close the site) were the loss of the Foster's contract to the US and the on-going shift in the marketplace from bottles to cans," said Kevin Boyce, Molson Canada's president and CEO.

"Another key element in the closure decision was the competitive need to reduce future operating costs. The current labour impasse, after months of negotiating, at the Edmonton brewery to reduce costs for new hire employees was a contributing factor to the decision."

The Edmonton site has no expansion capability, Molson said. "This limited expansion capability, combined with the business conditions noted above, have impacted the Molson supply chain making the efficient utilisation of the Canadian brewery network more critical to meeting customer expectations," the company said.

Employees have already been informed of the decision, and the company said it is looking to provide fair separation packages. The brewer said it will record a non-cash impairment charge of about $37m before taxes associated with the change.

Sectors: Beer & cider

Companies: Molson Coors

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