SABMiller's Chinese joint venture, China Resources Snow Breweries, is to buy three breweries in the country for a total US$110m.

CR Snow, which is 49%-owned by SABMiller and 51%-owned by China Resources Enterprise, said that it would acquire the brewing assets of Anqing Tianzhu Beer Company ("Tianzhu Beer"), Liaoning Songlin Brewery Group Company ("Songlin Brewery") and Zhejiang Luck Beer Company. 

The deal, which will give CR Snow 80%, 85% and 100% equity interests respectively in the brewers, includes a cash payment of US$93m, said the brewer today (26 February).

"All three breweries will undergo a technical upgrade to their existing facilities to comply with the production requirements of the Snow brand," it said.

SABMiller claimed late last year that sales figures showed Snow had become the biggest beer brand in the world.

Long Chen, managing director of China Resources Enterprise, said: "Liaoning, Anhui and Zhejiang are all our major existing markets. These acquisitions will enable us to strengthen on our position with wider geographical coverage and lower cost base."

Ari Mervis, managing director of SABMiller Asia, said that the deals would improve Snow's capacity to develop as a national beer brand in China.

Tianzhu Beer had an annual production capacity of about 980,000 hectolitres and sales volumes of about 400,000 hectolitres in 2007. It is situated in Anqing in the south-western Anhui Province, where SABMiller is already the largest brewer.

Songlin Brewery has two plants at Chaoyang and Jianping with a total sales volume of approximately 1.05m hectolitres in 2007. Its combined annual production capacity of 2.08m hectolitres will be increased to 2.5m hectolitres following the CR Snow acquisition. The brewery is situated in the Liaoning Province, where CR Snow is also the largest brewer.

Luck Beer is located at Yuhuan county, Taizhou, described as a prosperous coastal city. It had an annual production capacity of about 1.2m hectolitres and sales volumes of about 330,000 hectolitres in 2007. Luck will give CR Snow a greater presence in southern Zhejiang Province, the group said.