Coca-Cola Amatil will re-enter Australias beer market next year

Coca-Cola Amatil will re-enter Australia's beer market next year

Coca-Cola Amatil has lined up its return to the brewing fold in Australia for next year through a proposed joint venture with Casella Wines.

The new JV, the Australian Beer Company, will take over Casella's brewing operations from 16 December 2013, CCA said today (22 August). Under the agreement, the new entity will be responsible for the brewing and marketing of Casella's beer brands. 

However, Casella's wine business will remain separate and continue to be run by the wine group. 

Casella Wines’ MD, John Casella, said many "synergies" existed between the companies. "The prospect of any future partnership with CCA would provide tremendous scope to develop our brewing operations faster and more broadly than we could do on our own,” he added.

CCA's planned re-entry into the beer sector in Australia has been delayed after it agreed to stay out of the market when it sold its stake in Pacific Beverages. This came about in the shake-up over SABMiller's acquisition of Foster's Group last year

Terry Davis, CCA's MD, said the agreement with Casella will give the group  "access to a world class, low cost brewery". He added that the initial manufacturing capacity will mean the company will be able to cater to "approximately 15% of the premium beer market in Australia". 

CCA announced a healthy jump in H1 net profits today helped by an improvement in its domestic business. 

In June this year, CCA agreed to buy Foster's soft drinks brands as part of its rights acquired from the SABMiller deal fallout.