The MillerCoors joint venture began operations on 1 July 2008 and was an important step in maximising the value from SABMiller's North American assets. It aimed to create a business with the scale and efficiency to compete more effectively in the US market and promised to achieve US$500 million in annual cost savings by its third year of operation.
Now approaching the end of its second year, MillerCoors is ahead of schedule in its cost-management programme. The savings have come from actions such as optimising production across the brewery network in order to reduce distribution costs, integrating business processes and systems, combining the buying power of the two organisations and consolidating functions such as media buying and advertising.
In the past year, savings from synergies alone have amounted to US$248 million. Total synergy savings since MillerCoors began operations now stand at US$326 million. A further US$50 million has come from cost initiatives started by the parent companies and US$33 million from additional cost savings.
Going well beyond its original target, the business is now on track to generate US$750 million in total synergies and other cost savings by the end of the calendar year 2012 – a major boost to MillerCoors' ambition of becoming the best beer company in America.
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