Molson Coors, SABMiller unite US ops

SABMiller and Molson Coors, the second and third largest US-brewers respectively, have agreed to combine their US brewing operations in hopes of providing a more formidable challenge to industry leader, Anheuser-Busch, the AP reports. The joint venture will be called MillerCoors and will be responsible for selling brands such as Miller Lite and Coors Light in the US.

SABMiller is going to have a 58% economic interest in the venture while MolsonCoors will own 42% of the new company. Yet each will have equal voting interests. Specific financial terms of the deal were not disclosed. The companies said the venture will result in cost savings of $500 million, most of which will come from reducing shipping distances, finding economies of scale in brewing operations, optimizing production and eliminating duplicate corporate and marketing services.

Anheuser-Busch accounts for nearly half of the US market with brands such as Budweiser and Bud Light.