Molson-Coors Merger Hard to Swallow

by David Bernans

In November of 2000, Concordia University in Montreal baptized its commerce faculty the “John Molson School of Business”. Although the $10 million donated by the Molson family may have been a motivating factor, the JMSB claims to have chosen its namesake as a source of inspiration in its own right. According to the school’s web page, “the name John Molson reflects our high academic standards, our commitment to business excellence and our entrepreneurial spirit.”

John Molson came to British-occupied Lower Canada in 1782. With a little start-up money from his family back in the old country, he was able to found a profitable business keeping the British garrison in suds. Supplying an army of occupation was the bread and butter of John Molson’s enterprise, a kind of 18th century Halliburton. His brewery was so successful that he was eventually able to branch out into banking and steamship transportation, working his way into the colonial élite – the English business-owners’ regime that kept the less wealthy French “canadiens” and Native majority under British rule. He died just three years before the popular rebellion of 1837, but his son John Thomas, an officer in the British army, kept the Molson tradition alive by helping to crush the patriote upstarts. The JMSB web site summarizes the Molson tradition a little differently:

“In 1782, John Molson came to the New World with a pioneering spirit and a determination to succeed. In addition to founding a brewing and malting business, he played a central role in Montreal's economy and in the development of Canada's transportation and banking industries.”

More than 200 years later, the Molson brewing empire is still chugging along under the control of Eric Molson, who is Chairman of Molson’s Board, owner of 55% of the company’s voting shares and the Chancellor of Montreal’s Concordia University (home of the John Molson School of Business).

But it seems the “business excellence” and “entrepreneurial spirit” of the late John Molson may have skipped this particular generation. First there were some questionable business acquisitions in the 1980s and early 1990s (including a home building supplies firm, an industrial cleaning company and a stake in a home-decorating retailer). More recently, there was a $1.2 billion bust in the Brazilian beer market.

Yet even with today’s Molson family spending like drunken sailors, the old brewing business maintains about 43% of Canadian market share and still faithfully pumps out kegs of cash for John Molson’s progeny. And the Molson brand could, no doubt, continue to reward shareholders with steady revenues. Beer drinkers seem to identify with the Molson Canadian drinking “Joe Canadian” character whose anti-American rant became a sort of patriotic manifesto for many English-speaking Canadians. Even if the down-to-earth Joe persona was a marketing creation owned by an old money conservative family, he spoke a kind of depoliticized (Canadian) truth to (American) power: “A toque is a hat, a chesterfield is a couch, and it’s pronounced ‘zed,’ not ‘zee’… ‘zed’!… My name is Joe, and I am Canadian!”

But not content to hold on to its Canadian income trust, the Molson family with Eric in the lead, has hatched yet another plan to tap the endless pipeline of profits supposedly offered by the global marketplace. The latest deal is an effort to unite the Molson and Coors family brewing empires in a $6 to 8 billion “merger of equals”.

Where does this leave Joe Canadian? Will he still drink Molson Coors Canadian even though the company helps fund extreme right-wing Bush-backing American foundations and even though the political activities of Coors family members include active support of an anti-gay constitutional amendment in the US?

True, Chairman Eric Molson and working class Joe Canadian have never exactly been drinking buddies, but what could Joe Canadian and Chairman Pete Coors possibly have in common?

Pete Coors is the great grandson of Coors founder Adolph Coors, and is Chairman of Coors Brewing Company and the Adolph Coors Company. He sits on the boards of both the Adolph Coors Foundation and the Castlerock Foundation, organizations that have been instrumental in funding the extreme right-wing Heritage Foundation (founded by Joseph Coors). The Heritage Foundation is known for its support of the Reagan-Bush Star Wars initiatives, a complete ban on gays and lesbians in the military and Newt Gingrich’s “contract with America”. And in true right-wing Coors tradition, Pete Coors is running in the 2004 Senatorial election in Colorado on the Republican ticket. Oh yes, and he supports Bush’s constitutional amendment to exclude gays and lesbians from the legal institution of marriage.

Pete Coors’ political activities have caused so much uproar in the US queer community that he has managed to rekindle a moribund boycott Coors movement. In the 1970s, 80s and 90s the anti-gay and lesbian activities of Coors and its various foundations had created such a backlash in the queer community that popular boycotts were costing Coors money. So in 1998 Coors hired its first “gay and lesbian corporate relations manager”, Mary Cheney (yes, the lesbian daughter of Vice President Dick Cheney). Cheney convinced the queer community to drop its boycott through various outreach initiatives including a Coors-sponsored cross-country tour with the winner of the 1999 International Mr. Leather competition. Mary Cheney left Coors in 2000 to help in her father’s Vice-Presidential campaign. Unfortunately for Mary Cheney, her father now supports the President’s anti-gay constitutional amendment.

When Senatorial candidate Pete Coors also publicly supported Bush’s amendment, the queer community’s boycott Coors campaign was brought back to life. A Chicago-based coalition began taking out ads in Gay Chicago, The Windy City Times and the Chicago Free Press asking “What are you really buying?” The ads point out that Coors profits flow “substantially to the Coors family” and that Coors family members “have a long and continuing history of funding right-wing anti-gay causes with their profits.”

So what will Joe Canadian say to this new “merger of equals”? The same thing he said when Molson struck its licensing agreement to brew Canadian Coors products back in 1996: nothing. The Joe Canadian character will say whatever his corporate owners tell him to. But will Canadian beer drinkers swallow?