The world's leading brewing groupsmarginally increased their share of the global beer market in 1998 with the top 20accounting for 57% of global sales compared to their share of 48% in 1993, according tothe latest Global Brewer Handbook from Canadean, the leading international beverageanalysts. Most of this share growth has been due to consolidation through mergers andacquisitions. Of particular note are Interbrew's acquisition of Labatt (and throughthem a 30% stake in Mexican brewer FEMSA) and Anheuser-Busch's acquisition of a 50%equity stake in Mexico's largest brewer, Modelo.

The tempo of consolidation in the industryhas increased dramatically in 1999 and early 2000 with a number of major acquisitions andmergers.

Heineken acquired stakes in a number ofbreweries in Poland and merged these with its existing operations towards the end of 1998to secure market leadership. It then followed this with the acquisition of Spanish brewer,Cruzcampo, in June 1999 and smaller acquisitions in other parts of Eastern Europe such asSlovakia and Macedonia.

Meanwhile South African Breweries (SAB)acquired one of Foster's Chinese operations and then made a major acquisition inEastern Europe by purchasing Plzenske Pivovary (Pilsner Urquell) and Radegast, the leadingbrewers in the Czech Republic. This gave them a 35% share of this market and gave theirglobal volumes a substantial boost.

The Brazilian brewers, Brahma andAntarctica have recently merged to form Ambev. The resulting group is now a true giant interms of volume, although this is almost entirely through sales in South America.

Even more recently Scottish & Newcastle(S&N) has assumed management control of most of Danone's European brewingoperations (except those in Spain) with a view to acquiring or merging these with its ownin the near future. Bass, its main rival on the UK market has indicated it wishes to exitthe brewing industry and concentrate on its hotel and pub business, which is likely tolead to further consolidation as its operations are acquired by another major brewer.

TOP 10 GLOBAL BREWERS 1998, 1999P,2000F

1998 1999F 2000F
Company Volume
(Million HL)
Company Volume
(Million HL)
Company Volume
(Million HL)
1 Anheuser-Busch 149 Anheuser-Busch 155 Anheuser-Busch 158
2 Heineken 60 Heineken 71 Heineken 72
3 Interbrew 60 Interbrew 66 Interbrew 69
4 Miller 54 Miller 54 SAB 56
5 SAB 47 SAB 48 Ambev 56
6 Brahma 42 Brahma 40 Miller 53
7 Kirin 35 Kirin 33 S&N/Danone 36
8 Carlsberg 32 Kirin 33 Asahi 35
9 Asahi 31 Carlsberg 32 Kirin 32
10 Danone 30 Danone 32 Carlsberg 31
Top10 share of global volumes 42% 43% 45%

Note:  Total brewer volumes calculated on a consistent basis to allow full comparison, using Canadean's unique methodology (based on equity participation)

Source:  Canadean Global Brewer Handbook 2000

The past two years have seen many brewerschanging their strategies in the face of difficult market conditions. Foster's haspartially withdrawn from China, selling its breweries in Guangdong and Tianjin to reducelosses and concentrating on its Shanghai operations and the Foster's brand. Millerdisposed of its stake in the Canadian brewer Molson in early 1998, although it remains thelargest shareholder in Molson USA. This leaves Miller focusing mainly on its domesticmarket with licensed operations, mainly in the UK, providing the bulk of its remainingsales. US brewer Stroh has exited from brewing altogether, unable to compete in a marketdominated by much larger players, and in the UK both Bass and Whitbread have indicatedtheir intention to sell their brewing operations to concentrate on hotel and retailoperations.

The beer industry is thus likely toconsolidate further as brewers strive to cope with difficult conditions in many markets,whilst beer operations that no longer fit with wider corporate strategies are divested tothose whose business focus is firmly centred on brewing.

CONTENTS Page
Number
INTRODUCTION 2
Company Volume Calculation 2
Definitions 2
The Canadean Global Data Investigator 2
EXECUTIVE SUMMARY 4
TABLE OF KEY RELATIONSHIPS BETWEEN TOP 10 GLOBAL BREWERS 6
THE RANKINGS 7
Top 20 Global Brands, 1993-1998 7
Top 20 Global Brewers, 1993-1998 8
Top 20 Global Brewers: Domestic vs International Sales, 1993 vs 1998 9
Top 20 Global Brewers: Domestic vs International Sales (Chart), 1993-1998 10
Key Brewers: Operating Profit Per Hectolitre, 1998, Chart 11
Key Brewers: Volume, operating profit (US$) and net sales (US$), 1998 12
Top 15 Europe Brewers, 1993-1998 13
Top 10 Americas Brewers, 1993-1998 14
Top 10 Asia-Pacific Brewers, 1993-1998 15
Top 5 Africa Brewers, 1993-1998 16

THE BREWERS

Anheuser-Busch
Antarctica
Asahi
Asia Pacific Breweries
Baltic Beverages Holding
Bass
Bavaria
BBAG
Brahma
Carlsberg
CCU
Coors
Danone
FEMSA
Foster's
Guinness Ltd
Heineken
Interbrew
Kaiser S.A.
Kirin
Miller
Modelo
Polar
Pripps Ringnes/Hartwall
Quinsa
San Miguel
Scottish & Newcastle
South African Breweries
Stroh

Compiled using Canadean's extensiveglobal brewer and brand database, the Global Brewer Handbook provides a complete volumeanalysis of the domestic and international activities of the world's largest beercompanies. Global and regional volume rankings are given, together with profiles of thetop twenty global brewers and key regional players. The Global Brewer Handbook is anessential tool for strategic company research, competitor analysis and business planning.

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