The boss of Molson Coors UK expects to reap rapid profits from the group's £14m joint venture acquisition of Cobra Beer, The Grocer can reveal.

Although Cobra has failed to record a profit since its launch in 1989, MCUK chief executive Mark Hunter predicted the brand would become profitable within "a few months" of its incorporation into the Carling and Grolsch group.

Whereas Cobra had previously relied on outside parties for its sales and manufacturing, including a brewing deal with Wells & Young, Hunter said Cobra's costs would be reduced now it could access MCUK's in-house brewing, distribution and marketing operations. "The challenge is to change the business model to improve profitability," said Hunter. "Now we are brewing the beer ourselves and have our own distribution, Cobra will move from losing money to making profit very quickly.

"Cobra's appeal is already high and growing further still — the brand has increased 20% in volume in the past year."

Marketing will continue to focus on Cobra as an accompaniment to food.

MCUK and Cobra this week announced the formation of Cobra Beer Partnership, a joint venture split between MCUK and Lord Bilimoria that will own, produce and market the beer. The deal was rushed through after Cobra entered a pre-packaged administration.

Hunter said the priority was to "ensure a smooth transition for Cobra's customers" while integrating the brand into MCUK.

MCUK said it hoped to save as many jobs of Cobra staff as possible following a period of consultation.

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