E-Malt.com News article: Australia: Lion not in contact with AB InBev regarding the future of Corona distribution rights yet

Stuart Irvine, the boss of Australia’s biggest brewer, Lion, has not been in contact with Belgium’s Anheuser-Busch InBev to discuss the future of his exclusive local distribution rights to its top-selling Corona beer since its audacious takeover play for rival SABMiller last week, The Australian reported on September 22.

Corona is Australia’s fourth biggest selling beer, with Lion winning the local rights to the brand three years ago after SABMiller swallowed up the then rights holder, Foster’s, for A$12 billion.

But with AB InBev now circling SABMiller to create a A$382 billion beer giant, a portfolio of international beers, including Corona, could now be reshuffled to align with the new corporate realties of the global brewing industry.

“We have not been specifically in touch with them because there is no need to, because we are just controlling what we need to control,’’ Mr Irvine said.

Mr Irvine declined to detail the contract he has with AB InBev to distribute Corona, which was recently renewed in June for a number of years, or if there was any clauses triggering compensation payments if AB InBev decided to seize back the beer brand.

“Actually this AB InBev merger has been rumoured a lot over the last few years so it’s not the first time it’s been mentioned, and what is most important is what I call ‘controlling the controllables’ so we just focus on doing a great job for our brands that we have and delivering for all of our brand partners,’’ Mr Irvine said.

It is believed AB InBev must give 12 months’ notice to Lion if it wishes to remove its distribution rights to Corona. Corona currently has a 5.9 per cent slice of the Australian beer market.

“We don’t know what future holds,’’ Mr Irvine said.

“We’ve got these brands, we have got contracts in place for these brands, and we are working hard to honour those contracts as we always do — and that’s the best way for us to approach it

“The best thing we can do is to continue deliver against what’s in those contracts and working hard with all of our partners to make sure all of our brands are successful. That’s in the best interests of Lion.”

Lion, which was bought by Japanese conglomerate Kirin in 2009 in a deal that valued it at more than A$6 bln, owns Australia’s biggest-selling beer, XXXX Gold, which has a 12.1 per cent share of the national beer market. In late 2013 Lion bought craft brewer Little Creatures for more than A$250 mln.

Lion is licensed to make and distribute in Australia some popular beer brands, including bestsellers such as Corona, Heineken and Beck’s, all of which CC-Amatil — as well as other beverage companies — would love to snatch away to give greater bulk to their own beer business.


23 September, 2015