E-Malt.com News article: 796

Colombian brewer Bavaria is to trim its $2 billion debt load, refinance loans, and push forward with an ambitious plan of expansion in Latin America, Reuters writes.

The brewer, which forecast 2003 profits "similar" to the 336 billion pesos ($114 million) in profits in 2002, said it would focus this year on slashing its debt load by $300 million to $1.7 billion. "Our goal is to lower the level of Bavaria's indebtedness," the company's President Ricardo Obregon said in a statement.

Obregon added Bavaria aimed to refinance $400 million in debt due in 2003, including a $300 million loan from Santander Investment Bank.

The brewer, controlled by Colombian tycoon Julio Mario Santo Domingo, said it would invest $110 million this year -- the bulk of which, about $78 million, to be spent on its operations in Colombia. The rest of the funds would go to Bavaria interests abroad. Bavaria's Peruvian subsidiary, Cervecerias Backus & Johnston, would start making beer in Bolivia for domestic consumption for the first time, Obregon said.

Bavaria controls 95% of Colombia's beer market, about 92% of Ecuador's beer market and last year bought 24.5% of Peru's only brewer, Backus & Johnston. It now owns 55% of Backus & Johnston's common stock and is looking to buy more shares in the coming weeks. The brewer increased its profits by 79% last year in local-currency terms.


24 March, 2003