UPDATE 2-Molson noncommittal on cash use

* Molson ups savings target, gives '10 cash flow forecast

* Does not commit to share buybacks

* Says interested in deals if accretive in short term

* MillerCoors CEO sees costs moderating as 2010 goes on (Adds cash flow, cost savings goals; analyst comment, byline)

By Martinne Geller

NEW YORK, March 3 (Reuters) - Molson Coors Brewing Co (TAP.N) gave a higher-than-expected forecast for 2010 free cash flow at its investors meeting on Wednesday, but remained vague about how it would use its money.

The brewer of Molson Canadian and Coors Light said it expects 2010 free cash flow of $760 million, plus or minus 10 percent, on an underlying basis.

That was higher than Stifel Nicolaus analyst Mark Swartzberg's estimate of $317 million.

Molson said there were several possible uses for its cash, and did not commit to share buybacks, a fact that analysts say has been weighing on the stock.

"The fact that we don't make a decision that's in line with what (the) external environment tells us we should do is our decision," Chief Executive Peter Swinburn told investors and analysts.

"We have said that we will make a decision and we will let you know what we're going to do with the cash as we move forward this year," he added.

Swartzberg said Molson's "continued messaging of 'maybe soon' regarding share buybacks" was likely to remain an overhang on the stock near term.

"Share repurchase has its own benefits, by our analysis, but the more fundamental issue to the market in the absence of share repurchase is the implication that a large deal is on the horizon," Swartzberg wrote in a research note.

Regarding acquisitions, Swinburn said Molson's stance is the same as it has always been.

"That is, yes, we're interested in acquisitions to grow the business as long as they're smart," he said, adding that they must add to earnings and generate shareholder value in the short term.

Last month, The Source blog on The Wall Street Journal's website said Molson, SABMiller Plc (SAB.L) and Japan's Asahi Breweries Ltd (2502.T) could all be potential suitors for the beer business of Foster's Group Ltd FGL.AX if it was separate from the wine business.

Molson also raised its target for its cost-savings program by $50 million, saying it now expects annual cost-savings of $150 million by 2012.

At the same meeting Leo Kiely, chief executive of the MillerCoors venture between Molson and SABMiller, said he expects costs for commodities such as fuel and aluminum to moderate as 2010 progresses.

Kiely said he is looking for cost of goods sold per barrel of beer to increase at a mid-single-digit rate in the first half of 2010 with moderation in the back half of the year. (Reporting by Martinne Geller, editing by Robert MacMillan and Matthew Lewis)