COMMENT: InBev - in the realm of the Russian beer
Following the purchase of Alfa-Eco's stake in Sun Interbrew, InBev now has almost complete control of the Russian brewing giant. The move is a significant step towards InBev achieving its expansion objectives in the country and could well prove timely as the Russian beer market continues to grow.
Belgium-based InBev has taken almost complete control of Sun Interbrew, Russia's second largest brewer, having announced the acquisition of a 21% stake in the company from Alfa-Eco. Alfa's £183m sale of its Sun Interbrew stake marks a lucrative end to the investment company's six-month partnership with Sun and follows InBev's buyout of Indian company Sun Trade in the summer of 2004.
Thanks to the two deals, InBev has now increased its share of Sun Interbrew from 38% to 97%, representing important progress towards the company's avowed objective of becoming the most important player in the Chinese and Russian branded beer markets, both of which are growing rapidly. The deal also sees InBev secure Sun Interbrew's flagship beer Klinskoye.
The company is just one of the multinational breweries that are trying to capitalise on Russian consumers' growing taste for branded beers. Scottish & Newcastle for example has been present in Russia since the 1990s, having bought Baltika, the best-selling Russian beer brand.
InBev's move to bolster its presence in Russia is further evidence of the growing importance of this market to western brewers. The Russian beer market looks likely to continue growing, albeit more slowly than in recent years, and a concerted marketing push prior to the summer of 2005 could see a jump in sales. Traditionally, beer is not regarded as an alcoholic beverage in Russia, and its consumption is seasonal, with an important increase in sales occurring in the summer.
Furthermore, in expanding its size and global presence, InBev will not only benefit from more efficient economies of scale, but from significantly greater distribution reach.
However, this optimistic outlook may be tempered by the knowledge that Russia remains a somewhat volatile economy for foreign investors, some of which may have been alarmed by the recent power struggle between the government and the oil company Yukos.
The global roll-out of InBev's Brazilian beer, Brahma, adds a third premium brand to the global brewer's international portfolio but some observers have suggested it's an unnecessary step which threat...
InBev has sold its majority stake in Bosnia's Uniline brewery, according to local reports....
InBev has made an offer to acquire the remaining minority interests in its Russian business SUN Interbrew Ltd (SIL) that it doesn't own, at a price of US$33.41 in cash per security....
Baltika has bought into a Siberian brewer....
The Bosnian government has put a majority stake in the country's brewery Banjalucka Pivara up for sale. Previous efforts to privatise the brewer have failed....
San Miguel Brewery Hong Kong has secured a deal to distribute InBev's products in the city and neighbouring Macau....
Investment bank Goldman Sachs has restarted coverage of InBev. It has given the world's largest brewer by volume an "outperform" rating....
InBev, is to close its Labatt's Toronto brewery by the end of the year, with repercussions for some 265 employees. ...
- Brown-Forman's march on premium whisk(e)y -Comment
- Are consumers getting tired of consuming?
- Where does AB InBev see the future of beer?
- SABMiller in Cent'l & E Europe - What is for sale?
- Interview - Harviestoun Brewery MD Toby Knowles
- Brown-Forman to buy BenRiach Distillery Co
- Bacardi rolls out new global Martini ad - video
- Brown-Forman appoints new GTR marketing head
- Bacardi recruits ex-News International exec
- Guinness Nigeria sees YTD sales, profits tumble
- Global Scotch whisky insights - market forecasts, product innovation and consumer trends
- Consumer and Market Insights: Wine Market in China
- Global non-Scotch whiskies insights - market forecasts, product innovation and consumer trends
- What Next for Beer and Brewers Following the MegaBrew Deal?
- Emerging Drinks Industry Trends