Cobra readies expansion

£10 million set aside for marketing

The Cobra Beer Partnership, the newly-formed joint venture between Molson Coors UK and brand-founder Lord Karan Bilimoria, is to shell out £10 million on marketing the brand in the next three years.  

Cobra - marketed as a ‘less gassy’ beer - is distributed to 95% of the UK’s Indian restaurants. This week the partnership set out its plans for growing Cobra, which has enjoyed meteoric growth since its launch in 1989 but has never turned a profit.  

“Our focus is keeping growth maintained behind the brand,” said the partnership’s managing director Alan Davey. “Wine has had an easy ride but there’s absolutely no reason why beer can’t be seen as a great compliment to food.” 

And here lies the strategy for wrestling greater share of the market for Cobra. According to Davey, Cobra will strike from its heartland of Indian restaurants deeper into Britain’s on-trade and the take-home market by reinforcing the message that “you can’t have a curry without a Cobra”. 

Cobra joins brands including Carling – Britain’s best-selling lager – Grolsch, Sol, Coors Light and new addition Singha under Molson Coors UK’s umbrella. On the issue of Cobra cannibalising the firm’s existing brands as it grows, Molson Coors UK CEO Mark Hunter is unfazed.  

He told BG: “We have a 20% share of the UK beer market. I’m happy to live with the risk that we may cannibalise some of our own volume if it means that we are taking our competitors’ volumes.” 

Lord Bilimoria said that the deal with the US-Canadian multinational, which saw Molson Coors acquire a 51% stake in the new partnership for £14 million, was the realisation of a dream, two decades in the making, to make Cobra a global beer brand. 

He said: “The dream was to always aspire and achieve against all odds with integrity. Now it is to aspire and achieve with integrity, it is no longer against all odds.” 

But for many the formation of the new partnership has left a bitter taste. Unsecured creditors were left out of pocket to the tune of approximately £71 million when Molson Coors bought Cobra through a so-called ‘pre-pack administration’ in May. 

Lord Bilimoria, made a peer in 2006 by Tony Blair, said he was “adamant” that he would be able to resolve the outstanding debt issue. He said he was working to “settle” the outstanding £71 million but added that some of this would be covered by creditors’ own insurance.