The beverage business blog from Andy Morton
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Does A-B InBev have a different goal for Grupo Modelo?
12 Aug 2013 16:31
Anheuser-Busch InBev has sold the stake in Mexican football team Santos Laguna that it inherited through its US$20.1bn acquisition of Grupo Modelo.
Grupo Modelo's new CEO Ricardo Tadeu, who was promoted from within A-B InBev when the company bought Modelo in June, said the sale of Santos Laguna will allow Modelo to “focus on what it does best - brewing excellent beers”.
It was a slightly surprising move however as who only last month Modelo upped the number of football teams in Mexico it sponsors through its lager brand Corona.
The real reason may well be Tadeu's strident cost-cutting measures that, according to his interview with CNN's Spanish-language business site late last month, will see Modelo shed 4,000 jobs (out of 40,000) and slash expenditure by US$1bn, all within four years.
Looks like A-B InBev's takeover means it is a whole different ball game for Modelo.
First day nerves as Suntory shares make Tokyo debut
03 Jul 2013 16:17
Suntory's food and drinks unit got off to a lukewarm start on its first day of trading in Tokyo today (3 July).
Starting at JPY3,100 after an IPO that eventually raised just shy of US$4bn, the shares closed up by 1.5%. Considering the Tokyo Stock Exchange was down for the day by 3% overall, that wasn't too bad. But, Suntory will be hoping for bigger gains in the future, especially as it has made clear it intends to use the IPO money to fund overseas acquisitions in line with domestic rivals Kirin and Asahi.
Suntory last week priced its shares at the lower end of their valuation, and, according to a company spokesperson quoted by Bloomberg, the IPO was “more than three times oversubscribed by domestic investors and almost two times oversubscribed by those from overseas”.
Canadians to the rescue for Molson Coors
03 Jul 2013 16:17
“Get me a Canadian!” is not a request you hear all too often.
But earlier this year, parts of England, Belgium and France echoed to the unlikely demand after Molson Coors' Canadian unit planted fridges stacked full of its beer around the three countries. The catch? The bright red ice boxes can only be opened with a Canadian passport, hence the need for some - no doubt friendly and very polite - assistance from the northern North Americans.
Check out the YouTube clip above to see what happened.
Will AMA use "bully pulpit" to praise energy drinks ban?
17 Jun 2013 16:12
The annual meeting of the American Medical Association's policy-making body started yesterday (16 June), bringing with it the usual sharp intake of breath from the soft drinks industry.
Last year, it was the House of Delegates's tentative support for sugar taxes that brought out the sweats, while this year Forbes has already reported the AMA may support a ban on energy drinks. The body has no decision making powers but, according to Forbes, it has a “bully pulpit on public health issues” and on Friday, shares in Monster Beverage Corp dropped 7% on reports of the potential ban endorsement.
Monster is no stranger to share price swings - it fell 12% after the company released its Q1 results in May - and its stock has already rebounded somewhat in morning trading.
But Monster and fellow energy drinks makers will be hoping the good doctors don't add to the growing threat of government regulation - outlined here - before the week is over.
Craft still small beer compared to Coors Light
15 Jun 2013 10:00
Here's a quick reality check to anyone who thinks craft beer in the US is catching up with the industry's big guns.
During Molson Coors' investors day on Wednesday, CEO Peter Swinburn said last year's volume growth for the group's Coors Light brand was greater than that "of the top-ten craft brewers combined”.
Craft has about 6% of the US beer market, and is growing well ahead of the rest of the category. But judging from the above stat there is still a long way to go.
Lidio Carraro is Brazil's early World Cup favourite
22 May 2013 17:04
To me, there were noticeably fewer people at this year's London International Wine Fair (LIWF), which ends today (22 May), but that didn't stop the Brazil stand from attracting a bustling crowd on all three days.
While Wines of Brasil is hoping to triple exports off the back of a packed sports calender, there's one of the country's wineries set for a bigger year than most.
Lidio Carraro hit the jackpot when it was picked to provide Fifa's official wine of Brazil 2014. The label, which features a range of blends, is called Faces and will be officially unveiled at VinExpo in Bordeaux next month.
What's truly amazing about Lidio Carraro's fortune, however, is that while the wine will likely gain worldwide distribution because of Fifa's seal of approval (it is hunting for a UK distributor at LIWF, I was told) and will be served at all Fifa functions up to and including the World Cup, the winery is a mere 40 hectares, or roughly 40 Fifa-regulation-sized football pitches.
Lidio Carraro will use stock from other Brazilian vineyards to make up for the inevitable shortfall in liquid, hence the need for a blend. But despite the inherent craziness in picking a family-owned (and family-sized) vineyard to serve the world its wine, Fifa must be applauded for backing one of the little guys.
Even if Brazil don't lift the World Cup, Lidio Carraro is already a guaranteed winner.
US$15m for Coca-Cola's original recipe? Not these days
15 May 2013 10:56
You can get all sorts of things on eBay - a new laptop, a car, the original recipe for Coca-Cola.
Yes, really. Well, probably. A man called Cliff Kluge claims to have found the soft drinks equivalent of the holy grail in a pile of letters bought at an estate sale in Georgia and is now selling it on the online auction site for up to US$15m.
Sorry, how much?
Cliff is obviously unaware of the declining value of full-sugar cola CSDs that has seen The Coca-Cola Co embrace low- and no-calorie ideals and PepsiCo attempt to reinvent the category with a sweetener shakeup.
Now, if he were to find a recipe for a zero-calorie carbonated soft-drink that uses all-natural ingredients and shifts over a billion cans a day, then I'm sure he could name his price.
I can think of at least two companies that would be very interested.
Reputation re-building as Mr 'New Coke' heads to Castle
10 May 2013 14:38
There's an old joke that riffs on an unfortunate elderly farmer who can't live down an amorous encounter with a fluffy farm animal. Never mind that it happened once, and a long time ago at that, he's destined to be forever known around his local village by a nickname I can't repeat here.
I remembered the joke today when I read about a former CMO of the Coca-Cola Co who is joining the board of directors at Castle Brands, a spirits and wines brand developer based out of New York. Sergio Zyman is a multiple author, writer of such memorable slogans as “Coke Is It” and a man who reportedly sold a majority stake in his marketing firm for US$63.8m.
However, because he was behind the fiasco that was 'New Coke', he won't be remembered for any of that. Instead any story on Zyman (including ours) will forever refer to him first and foremost as “the guy who gave us New Coke”.
Some things you can never live down.
Russia's rich fuelling a brewing revolution
15 Mar 2013 12:34
Just-drinks is at BeerX (15 March), the annual get-together of the Society of Independent Brewers (SIBA).
It's in Sheffield, but maybe SIBA should consider a branch meeting in St Petersburg. According to a sales manager for Keg Technik, a German keg filling manufacture, the real brewing action is in Russia, where rich businessmen are investing spare cash in their own vanity breweries.
“They're sprouting up like mushrooms,” said Christopher, whose company is tapping into the growing demand for equipment from these wealthy hobbyists, who are apparently making good profits.
You heard it here first folks.
Stevia - a bitter pill for sugar?
14 Mar 2013 15:01
There's an interesting article on sugar prices in this week's New York magazine that will no doubt raise the ire of soft drinks executives.
It claims that despite massive government subsidies - and a recent big harvest - the US sugar industry is keeping prices artificially high.
But while the writer calls for an Occupy Sugar protest, the US drinks companies paying through the nose for sugar may have another answer. More stevia-based beverages are coming down the pipe each week, from PepsiCo's Trop50 range to The Coca-Cola Co's revamped Sprite, and the natural extract, which is 30 times sweeter than sugar, could insulate firms from the sugar industry.
As I wrote this year, stevia growers are already benefiting from an increase in interest in the plant.
Of course, who's to say that a few years down the line we won't need protecting from the all-powerful stevia lobby, who's huge profits have won it the ear of Washington and the patronage of the president?
Remember, you heard it here first - Occupy Stevia!