SABMiller plc announced on July 4th that, following recent approval from the Ukrainian competition authorities, it has now completed the acquisition of 99.84% interest in the Ukrainian brewer CJSC Sarmat (“Sarmat”).

Sarmat is one of the largest brewers in the Ukraine and will operate one brewery in Donetsk in the east of the country with an annual production capacity of 2.9 million hectolitres, producing the Sarmat, Dnipro and Drive Max brands.

Igor Tikhonov will be appointed Managing Director of Sarmat, having previously been Managing Director CIS at SABMiller RUS. Commenting on the appointment, James Wilson, Managing Director of SABMiller RUS said, “I am confident that with Igor’s extensive experience and knowledge we will be able to deliver strong results in the Ukraine and benefit from this fast growing and attractive market.”

SABMiller will initially focus on upgrading Sarmat’s facilities in accordance with its world class global manufacturing standards to increase the operational efficiency and overall effectiveness of the business. SABMiller will also seek to immediately strengthen the existing Sarmat brands and then in the medium term introduce a selection of its international and regional worthmore brands into the Ukraine.

This acquisition represents SABMiller’s entry into one of the fastest growing beer markets globally ...More Info

Attorneys for Anheuser-Busch Cos. argued Wednesday, July 2nd, that two shareholder lawsuits in the brewer's hometown should be suspended while a Delaware judge considers nearly a dozen similar lawsuits related to the possible takeover by rival brewer InBev, according to Associated Press.

If the lawsuits are suspended in Missouri, it means Delaware will become the central focus for frustrated shareholders who say Anheuser-Busch's board of directors is hurting the company's long-term stock value by not accepting InBev's offer.

The Belgian brewer's offer price of $46 billion amounts to $65 a share for Anheuser-Busch stockholders, a premium over the company's $50 share price before market speculation about InBev's offer began to drive the price up. Anheuser-Busch has rejected InBev's offer, laying out a plan to drive up its stock price within a few years by cutting costs and increasing prices.

Shareholders have a right to sue a company's board of directors if they feel the directors aren't acting in the interest of all those who own its stock. The suits could put more pressure on Anheuser-Busch's board. InBev has indicated it will take its offer directly to shareholders, who can overrule the board.

The shareholder lawsuits keep piling up, even as Anheuser-Busch and InBev spar ...More Info

Belgian brewer InBev hired JPMorgan Chase & Co., BNP Paribas and Deutsche Bank AG as lead managers for a stock sale to help fund its proposed $46.3 billion takeover of Anheuser-Busch Cos. Inc., Belgian newspaper De Tijd reported on June 2 as per St. Louis Business Journal.

Without disclosing how it obtained its information, De Tijd reported that Fortis, ING Groep NV, Royal Bank of Scotland and Banco Santander SA also were appointed as joint managers.

It is not known how much InBev plans to raise by selling stock, according to the publication. An InBev spokeswoman was not immediately available for comment.

InBev informed Anheuser-Busch June 25 that it paid approximately $50 million in commitment fees to its lending group, demonstrating its resolve to make a deal happen.

The company's lending group is comprised of Banco Santander, Bank of Tokyo-Mitsubishi, Barclays Capital, BNP Paribas, Deutsche Bank, Fortis, ING Bank, JP Morgan, Mizuho Corporate Bank and Royal Bank of Scotland.

Anheuser-Busch director Douglas Warner III was chairman of JPMorgan Chase & Co. in New York until he retired in November 2001.

On June 26, Anheuser-Busch formally rejected InBev's proposal, calling the $65-per-share offer "financially inadequate and not in the best interests ...More Info

With rising energy costs and the increased price of hops and malt, German breweries have been spending some 8 percent more to make their products, said German Brewery Federation chief Peter Hahn on July 2nd, according to Associated Press.

That will now be passed on to the consumer, with price hikes in the range of 50 euro cents (80 U.S. cents) to €1 (US$1.60) per case of 20 beers, Hahn said.

He added that further increases could not be ruled out, if the price of energy and raw materials continues to rise.

The U.S. Gannon Group will spend $90 million to build and operate a brewing facility near Ho Chi Minh City, according to Thomson Financial News. The company announced on June 3 it was granted a licence by Vietnam.

The facility will manufacture and produce beer and other aerated drinks for distribution in Vietnam and export through Southeast Asia, the company said. 'Vietnam is one of the fastest growing beverage markets in the world and beer is leading that charge,' said Gannon chief executive officer Walter Blocker. 'In a country where demand, especially for premium products, is surging, it's imperative that it be in a position to supply.'

Besides beverage production, Gannon Vietnam Limited, an affiliate of Gannon International, has operations including labelling, packaging, warehousing, logistics, industrial leasing and infrastructure development.

Brewer and pub owner Greene King has reported a rise in annual profits despite facing what it said was an "unprecedented set of challenges".

Financial Highlights �� Revenue £960.5m, +5% �� Operating profit* £236.2m, +8%; +4.5% excluding acquisitions �� Operating profit margin* 24.6%, +0.8 percentage points �� Profit before tax* £142.0m, +2% �� Adjusted earnings per share* 74.0p, +14% �� Dividend per share 26.0p, +14% �� Free cash flow £31.1m after capital expenditure and dividend �� Successful £350m securitisation tap (post year end); no further refinancing needed until 2012

Business Highlights �� Retail Operating profit* +5% Strong growth in food: now 34% of sales Loch Fyne successfully integrated and trading well �� Pub Partners Operating profit* per pub +8% Operating profit margin* +3.1 percentage points �� Belhaven Operating profit* +18% Food sales +31% �� Brewing Company Own-brewed volume +6% Market share gains in on- and off-trade

Rooney Anand, Greene King chief executive, comments: “The year saw an unprecedented set of challenges for the industry but I am pleased to report exceptional performance across the business. Our results in Scotland, with operating profit up 18% in the second year of the smoking ban, give me some encouragement for future prospects in England. The economy is not likely to improve in the short term, and we are not immune to the difficulties this presents for ...More Info

China's largest beer producer by sales, Beijing Yanjing Brewery Co, said on June 3rd it has received green light from the China Securities Regulatory Commission (CSRC) to privately place A shares for RMB 1.79 billion, according to China Knowledge.

Yanjing Brewery plans to issue 85 million to 100 million A shares to about 10 of its major shareholders at a price of RMB 17.88 a share, to fund capacity expansion, according to a statement the company filed with the Shenzhen bourse in May.

Parent Beijing Yanjing Brewery Group Corp has agreed to subscribe at least 50% of the new shares on offer, with a lock-up period of 36 months, the statement said. The remaining shares, with a shorter lock-up period of 12 months, are to be offered to other shareholders.

Yanjing Brewery aims to consolidate its leading position in the domestic beer market by expanding capacity, according to market sources.

Currently, Yanjing Brewery, Tsingtao Brewery Co Ltd<600600><168> and China Resource Brewery Co Ltd together have a share of about 40% in China's beer market.

Yanjing Brewery is principally engaged in manufacture and sale of beer, mineral water, cola drinks and beer raw materials, etc., under its trademark 'Yanjing'. It also trades ...More Info

New crop price levels have gained at least EUR 10,- per ton from their lowest level some weeks ago. Brewers and maybe also maltsters and traders had waited for lower malting barley markets, which did not happen to-date, market analysts commented. It is not easy at this moment to make a clear forecast on malt prices for the new campaign, but in general prices look steady to firm.

What are the reasons? 1) General grain markets give a solid fundament for the market of malting barley. 2) Farmers have a much higher production of cost of grains and oilseeds due to the cost of seed, fertilizer, herbicides and diesel. 3) In case of disappointingly low premiums of malting barley above feed barley and wheat, a strong acreage reduction would occur in 2009. 4) Maltsters have sold a high percentage (80 %?) of their capacities for 2009. They are also confronted by the constantly rising cost of energy and transport. 5) Malting capacities are lower than demand at present. The economic boom in China, India and Arab countries and the beer boom in many parts of the world filled order books of construction companies for years to come, and malthouse construction ...More Info

Southern Europe from the Iberian Peninsula to the Balkans had exceptionally abundant precipitation. Recently heavy rains and storms led to lodging of barley fields in some regions.

France and England planted very early and recorded continuous rainfalls during the vegetation period. The situation was not quite as good in South Germany, but a fair crop is still possible. Early tests show low proteins and good plumpness of barley, it looks as if Europe can supply quality barley and malt in 2008/09.

A question is, whether the six-row winter barley Cervoise can shed its bad reputation of a compromise variety. Cervoise represents about 40 % equal 600 -700.000 tons of the French winter barley deliveries.

The Baltic Sea countries planted late because of heavy rains in March and April and then suffered from very dry conditions, which have just come to an end. However, some damage seems irreversible. In our S/D we show fairly reliable figures for Western Europe and doubtful receival and surplus numbers for Denmark and Sweden. Local experts in the countries from Southern Poland, Czech and Austria down to Romania and Bulgaria expect quite some cross border trade, but altogether neither a large surplus nor a deficit.

The ...More Info

The area seeded to barley for 2008-2009 is estimated by Statistics Canada to have decreased by 17%, Agriculture and Agri-Food Canada published on July 2. Barley production is forecast to decrease by 10%, as the decline in area is partly offset by higher yields. Supply is expected to fall by 11% due to slightly lower carry-in stocks.

Total barley exports are expected to decrease significantly due to lower exports of feed barley. Carry-out stocks are forecast to decrease slightly to a record low level. The average off-Board feed barley price (No. 1 CW I/S Lethbridge) is forecast to increase from 2007-08 due to lower supply and higher US feed grain prices.

Barley harvest has started in France and parts of Germany, with yields apparently up on last year and quality in line with expectations, Farmers Weekly Interactive cited Glencore's Nick Oakhill on July 3.

"Harvest prices still look good, but the biggest thing that could put downward pressure on UK prices will be crop quality. If we get good weather and quality, it puts us in a healthy position for selling the expected 3m-tonne exportable surplus. But if we get a poor run, that surplus will have to compete with cheap supplies from eastern Europe and the Black Sea regions."

With the European barley harvest under way and the UK expected to start in some south-eastern areas next week, traders are optimistic about prospects for new-season crops

Wheat production across the EU-27 was likely to hit 130m tonnes, compared with 111m tonnest last year, David Sheppard of Gleadell said. "There will be some rebuilding of world stocks by 15-20m tonnes, but if all crop predictions come in, we will see prices come down."

Barley production was expected to be 5.6m tonnes, up 0.5m tonnes on 2007/08, leaving an exportable surplus (malting and feed) of just under 1m tonnes, he said.

Ongoing speculation over crop size ...More Info

R. C. Agu, T. A. Bringhurst and J. M. Brosnan

Abstract
J. Inst. Brew. 114(1), 62–68, 2008 Studies carried out on normal husked barley, normal hull-less (naked) barley, acid dehusked barley and acid dehusked hull-less barley, as well as the malts derived from them, showed that when acid dehusked barley samples (obtained from either husked or hull-less barley), were processed using commercial enzyme preparations, they produced more alcohol when compared with the alcohol yield obtained from the barley samples from which the acid dehusked samples were derived. When the husked (Optic) control, acid dehusked and hull-less barley samples were malted, Optic control barley produced malt that gave higher dextrinising units (DU) and diastatic power (DP), whilst acid dehusked Optic and hull-less barley produced malts that gave similar DU results on day 5 of the germination time. When mashed, acid dehusked (Optic) barley malt produced wort that filtered faster than the wort obtained from the malt made from hull-less barley. This observation is very important because it shows that the husk of the barley is not the only factor that determines the filtration performance of the malted barley, since both the malt samples made from husked and acid dehusked barley had similar filtration rates on day 5 of the germination time. The slow filtration rate observed for the wort made from hull-less barley suggests that other factors play some role during the filtration of the mash made from hull-less barley malt. Although hull-less malt appeared to develop lower DU and DP enzyme activities, when compared with the values obtained for the Optic control, hull-less barley malted faster and produced optimum predicted spirit yield (PSY) at day 4 of the germination time. In contrast, the control husked Optic barley malt that had higher DU and DP produced equivalent (optimum) predicted spirit yield one day later at 5 days germination time. This is an advantage for hull-less barley, both in terms of time and energy saving during the malting of barley. Although the acid dehusked Optic barley produced more alcohol than the husked control when commercial enzyme preparation was used to process barley, it was surprising that when the derived malt was assessed, it gave a lower predicted spirit yield than the husked control, even though it produced a higher amount of hot water extract (HWE). The higher extract yield and lower predicted spirit yield obtained from the malt made from acid dehusked malt confirmed that high extract yield is not necessarily associated with high fermentable extract. Key words: Alcohol yield, acid de-husked barley, barley, diastatic power, dextrinising unit, filtration rate, hull-less barley. ... Load full article, 6 pages, 1504 Kb, PDF file