Juggling Shareholders' Expectations: The Molson-Coors Merger

Name: Juggling Shareholders' Expectations: The Molson-Coors Merger (English version)
SKU: HEC285

Mesny, Anne; ST-ONGE, Sylvie; MAGNAN, Michel

Product #:HEC285

Supplier:HEC Montreal

Discipline:General Management

Setting:Canada

Details:Case (PDF) • 10 pages • 2021-05-05

Subjects:

Corporate governance Shareholder relations Leadership Family businesses Power and influence Business management Public relations Leadership and managing people Business structures Leadership and managing people Management

Geography:

Canada North America

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On July 21, 2004, Molson's board approved a merger of equals between Molson and Coors. For Eric Molson, chair of the board since 1988, and also head of the Molson family and controlling shareholder, this merger with a strategic partner of similar size would make the merged company - Molson Coors - the fifth-largest brewer in the world. Before this could happen, however, Molson shareholders had to be convinced that this merger would be fair to everyone, not just to the Molson family members who held Class B shares (with voting rights). The merger would require the approval of two-thirds of both the voting and non-voting classes of Molson shareholders. This was far from a done deal since a merger of equals is a zero-premium deal for shareholders. The case explains how Eric and other stakeholders managed to convince Molson shareholders to approve the merger of equals with Coors.

Learning Objectives

Understand the different types of shareholder in public family firms and the consequences of this diversity in terms of governance and strategy. Understand the efforts required of the board and senior executives of a public firm to sell a strategic course to shareholders. Analyse the rational, political, and symbolic dimensions of decisions and the need to manage all aspects of them.