Backus and Johnston is to upgrade its operations in Peru.

The SABMiller subsidiary confirmed today (25 August) that it will spend US$102m between now and March next year on infrastructural projects in its home country.

Among the areas set to benefit from the investment are the Ate facility, east of Lima, which will have its brewhouse expanded, and the brewery in Motupe, northern Peru, which will get a new brewhouse altogether. At the same time the company's packaging capabilities across Peru will be upgraded, while US$12m will be spent on fridges, coolers and trade equipment, with the aim of improving the accessibility of cold product to all Peruvians.

"The investments will serve to extend the production capacity in the brewery plants in Lima as well as interior of the country, which will comply with the most modern technology in brewing, fermentation and packaging processes," said Backus president Robert Priday. "The investment will ensure that we can sustain and improve on the high quality of beer we have become renowned for.

"It is also a reflection of our commitment and confidence in our operation in the country. The steady improvement in the local economy deserves to be rewarded with investments of this nature."

Separately, Backus announced a proposed merger with Cervesur, its majority-owned affiliate and other affiliate companies. The company said that this nil-premium transaction will serve to simplify and streamline SABMiller's operations in Peru into a more directly manageable and accountable holding structure. Backus bought almost all - 98% - of the shares in Cervesur in 2000 for US$124m.

SABMiller acquired a controlling stake in Backus last July as part of its takeover of Colombia's Bavaria. Earlier this year, SABMiller confirmed that it had bought up almost all the shares in the Peruvian company.