PERU: SABMiller to invest over US$90m in Backus arm

By | 31 March 2006

SABMiller plans to invest over US$90m in its Peruvian operations to maintain its dominance of the country's beer market.

The London-listed brewing giant took control of Peru's largest brewer, Backus, after its acquisition of Latin America's second largest brewer, Bavaria, last year.

SABMiller is planning "significant" investment across the business in boosting production and improving the packaging, marketing and distribution of its brands in Peru, a spokesman told just-drinks today (31 March).

"We are making a significant investment in packaging and marketing to improve our competitive situation," he said.

SABMiller expects higher profits from Backus this year as beer consumption continues to grow in the emerging beer market. Backus controls over 90% of the beer market in Peru but its dominance has failed to dissuade InBev's Brazilian unit AmBev from entering the market last year. AmBev is said to have grabbed around an 18% share of the market in the Peruvian capital, Lima, but its performance is so far not worrying SABMiller.

"We're entirely confident in the competitive situation in Peru," the spokesman added.

Yesterday, SABMiller said it had bought up the bulk of the shares in Backus and owned 89.5% of the brewer. It extended its offer to buy the rest of the shares to 5 April.

Sectors: Beer & cider

Companies: SABMiller, Bavaria, AmBev

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PERU: SABMiller to invest over US$90m in Backus arm

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