Molson Coors Brewing Company has announced that its board of directors has approved a 20% increase in the quarterly dividend rate on its Class A and Class B common shares.

The dividend, which has increased from US$0.20 per share in the first of quarter of 2008 to US$0.24 per share in 2009, is payable on 15 June to shareholders of record on 29 May.

In addition, Molson Coors Canada declared a quarterly dividend on its Class A and Class B exchangeable shares of approximately CDN$0.28 - the Canadian equivalent of the dividend declared on the Molson Coors' stock.

Molson Coors president and CEO Peter Swinburn said: "We are in a strong position to increase cash returns to shareholders, while preserving the financial flexibility to explore growth opportunities that meet our strict return criteria."

Molson is understood to be interested in acquiring the UK arm of Cobra Beer, which has been put up for sale by Lord Bilimoria.