Beer Monopoly




    International Reports







Posted July 2014

Germany – U.S. craft brewer Stone to open a brewery in Berlin

It’s amazing. Another U.S. craft brewer has ventured overseas. Really, you have to admire them for their guts. It takes guts, and probably more, to want to open a brewery in Germany these days. Beer consumption is in decline, competition is fierce and U.S.-style “craft beer” largely unheard of.

But this is what Stone is planning to do. The 10th ranking U.S. craft brewer from San Diego announced in mid-July 2014 that it has closed a deal to open a brewery and bistro in Berlin, becoming the first American craft brewer to independently own and operate a brewery in Europe.

Stone is not the first craft brewer to build a brewery in “Old Europe”. Brooklyn Brewery was the first. But its recently opened outfit in Stockholm is a venture between Brooklyn and Carlsberg and therefore, in Stone’s view, not independently owned.

Known for its hop-centric beers, Stone will set up shop in a former gasworks plant in south Berlin in a move expected to cost at least USD 25 million (EUR 19 million). Once proper permits are secured, the construction is expected to take 14 to 20 months, putting Stone on target for an opening in late 2015.

According to reports, Stone plans to install a 70 barrel brewhouse (equalling a 40,000 hl capacity, approximately) to produce year-round and special-release brews that will initially be packaged, kegged and served on-site, but will eventually be distributed in Germany and elsewhere in Europe.

Like Scotland’s BrewDog, Stone has also set up a crowd-funding scheme, called Indiegogo (at, where fans will be able to buy certificates for future “Stone Groundbreaking Collaborations” which will be brewed in Berlin once the facility is open. Stone hopes to raise USD 1 million through the campaign which runs until 16 August 2014, with the money used to expedite both the Berlin project and a future “east of the Mississippi” Stone brewery.

The remarkable thing is not that Stone has chosen Berlin for its new site. Berlin is the largest and probably most cosmopolitan of all German cities. Therefore, I believe that if they can build up interest in their beers – as the other Californian brewer Lagunitas did in Chicago before they opened a brewery there this spring – Stone will receive a hero’s welcome in Berlin.

Actually, what is even more remarkable is that Stone was only founded in 1996 by Greg Koch and Steve Wagner. As Mr Koch said, five years ago they began looking for a site in Europe. Well, five years ago, when they took the unprecedented decision to scan Europe for a brewery location, Stone had been operating for a mere 13 years and was producing under 100,000 hl beer. That’s what I would call ambitious.

In 2013 Stone brewed 250,000 hl beer according to estimates by Beer Marketers Insights with net revenues of USD 137 million (EUR 102 million).


Mexico – Mexico restricts TV commercials for soft drinks

Anti-sugar campaigners watch out: with 70 percent of adults and 30 percent of children believed to be obese or overweight, the Mexican government has taken the extraordinary step to restrict television advertising hours for high-calorie food and soft drinks.

It was reported on 16 July 2014 that such ads will be banned with immediate effect on terrestrial and cable TV between 14:30 and 19:30 on weekdays and between 07:30 and 19:30 at weekends when most families sit in front of the box.

Restrictions will also be imposed on similar ads shown at the cinemas.

It is estimated that overall, 40 percent of commercials for soft drinks, confectionery and chocolates will disappear from TV. Read on


Ireland - Diageo drops Arthur’s Day in favour of Amplify

Guinness brewer Diageo has discontinued the controversial Arthur’s Day celebrations in favour of a new format called Guinness Amplify, which will see a series of music events take place every weekend for the month of September throughout Ireland.

Arthur’s Day – in commemoration of Arthur Guinness, the founder of the brewery - was run annually on 26 September. It was launched in 2009 and, following the success of the first year, Diageo decided to make it an annual event with bars sporting Guinness promotions in venues around Ireland and in 55 countries worldwide. Read on


Germany – Beer and sausage cartels fight back

You could be forgiven for thinking that Germany is a hotbed of illegal shenanigans. In July 2014, the Germany Federal Cartel Office issued fines of more than EUR 338 million (USD 455 million) on 21 sausage makers for illegal price fixing. Several companies have denied the allegations and announced legal action against the fines imposed on them.

The Federal Cartel Office also said that several brewers accused of collusion earlier this year have since decided to take their case to court in order to contest the fine. The German news magazine "Focus" identified six brewers and a regional brewers association. A spokesman for the Federal Cartel Office would not provide any details to their identity. Read on



Russia – Russia to allow beer adverts during the 2018 Football World Cup

It was a picture to behold: Ms Merkel, the German Chancellor, sitting next to Sepp Blatter, President of FIFA and Vladimir Putin in Rio’s Maracana Stadium during the World Cup final. One wicked person twittered: “Mutti, The Bad and The Ugly”.

Surprisingly, on the photo Mr Putin looked somewhat glum – like Brazil’s President Dilma Rousseff, who sat nearby. But she had every reason to look miserable: As crazy as it seems, there's a real chance that Brazilian voters will punish Ms Rousseff for Brazil's defeat in the World Cup when Brazil goes to the polls in October. The estimated cost for hosting the games in Brazil is said to be more than USD 11 billion. How Brazil will ever recover those costs is a big question.

Mr Putin, however, seems to have an idea: Russia, which is hosting the soccer World Cup in 2018, will relax its ban on beer advertising until after the event, media reported. There you go.

As Russia is expected to spend even more on the World Cup - around USD 20 billion - easing advertising rules will allow it to benefit from hefty marketing spending by brewers Carlsberg, AB-InBev, Heineken and others. Read on


USA – Every American lives within ten miles of a brewery

Statistically, beer-loving Americans never had it so good. This June marked a milestone in the U.S. brewing industry as the number of breweries operating in the country passed 3,000, according to the Brewers Association.

The industry body reported it’s likely the first time the total has passed 3,000 since the 1870s, when the number of breweries reached a high point of 4,131 in 1873.

Since the beginning of 2011, breweries have opened at a rate of one per day. Over the past two years, it’s been 1.2 per day. This year it looks like the growth could even be faster.

Still, almost 99 percent of the 3,040 breweries currently operating are small and independent, based in neighbourhoods or towns. Read on


USA – Francine Katz wants new trial in gender discrimination suit against Anheuser-Busch

Who would have thought that Ms Katz would file for a new trial? Only in May 2014, after three weeks of testimony and ten hours of deliberation, the majority of jurors had sided with Anheuser-Busch, thus throwing out Ms Katz’ gender discrimination suit against the brewer.

But in early July 2014 it was reported by St. Louis media that Ms Katz has filed for a new trial. Read on


South Africa - SABMiller will sell its USD 1 billion stake Tsogo Sun

SABMiller follows up words with action. A few weeks after the world’s number two brewer announced a review of its 39.6 percent stake in South Africa’s top gaming and hotel group Tsogo Sun, the brewer said on 7 July 2014 now was the right time to exit this investment. SABMiller has held the stake, currently valued at USD 1.1 billion, since 2002 when it transferred its gaming and hotel assets to Tsogo Sun.

Rather than dishing out the cash to shareholders, SABMiller said it would reinvest the proceeds to beef up its African beer business. The brewer plans to sell most of its stake this month through a private placement to institutional shareholders. Read on


Australia - Glenn Cooper retires from day-to-day operations of Coopers Brewery

If you appreciate plain-talking brewers, you will meet the news that Glenn Cooper, 63, has retired from his executive role as Sales Director at Premium Beverages, a subsidiary of Coopers Brewery, at the start of July, with some regret.

However, Mr Cooper, who is a fifth generation member of the Cooper family, will remain Chairman of the company, a position he has held since 2002.

Mr Cooper will be succeeded by Cam Pearce, an existing director with the company.

As to his future plans, Mr Coopers said he wants to be the “Wolf Blass of Coopers Brewery. I am going to be an ambassador for Coopers similar to what Wolf does,” Mr Cooper told local media.

In case readers have never heard of Mr Blass (which seems unlikely): the German-born Wolfgang Blass, 80, a flamboyant, bow-tie sporting self-publicist, is one of the best known names in the Australian wine industry. He started the Wolf Blass winery based in the Barossa Valley, which he sold to Mildara Wines in 1991, to form Mildara Blass, and which was itself bought by Foster’s Brewing six years later.

Like Mr Blass, Mr Cooper will continue to represent the Coopers brewery in various ways, including attendance at key events and functions and will retain an interest in beer export activities in the North American and Asian markets, including South Korea.

Having trained as an automotive electrician, Mr Cooper studied business management before setting up his own business in computer sales and services.

He became a Director of Coopers in 1988 and in 1990 began work at the brewery, before taking the position of Marketing Director in 1996 and being elected company Chairman in 2002.

In 2012, Mr Cooper assumed the role of Sales Director at Premium Beverages and has also recently been appointed as Chairman of The Australian Made Campaign, a not-for-profit organisation that administers the famous green-and-gold Australian Made, Australian Grown logo.

Coopers’ Managing Director Dr Tim Cooper said Glenn had played a key role in creating consumer engagement for Coopers and its brands during the strongest period of growth in the company’s history since before the Depression.


United Kingdom – Nothing to declare at SABMiller

SABMiller’s stigma as a tax dodger does not seem to want to go away. Four years after the UK charity ActionAid exposed the brewer of depriving poor countries of millions in revenues, the Sunday Times newspaper ran a comment on 29 June 2014 with the opening line: “You could be forgiven for thinking SABMiller’s newish boss Alan Clark has a guilty conscience.”

Readers wondering why he should have one, had to read on. “Keen to underscore its squeaky-clean credentials”, the piece said, SABMiller’s annual report [released on 23 June 2014] shows that it disbursed USD 10.8 billion to governments last year. This is equivalent to 32 percent of its global revenues. Excise was USD 5.6 billion of the total, with corporation tax amounting to USD 1.5 billion. The Sunday Times remarked: “This was a highly respectable 26 percent of its USD 5.6 billion total profit.”

However, when the newspaper dug further into SABMiller’s accounts in order to find out how much Britain’s eighth largest listed company paid to the UK’s taxman, it discovered: nothing.

When the Sunday Times approached SABMiller, the newspaper was given the following explanation: “The costs of operating a UK-based head office outweigh the profitability of our UK trading operation, so we do not currently pay UK corporation tax.” Read on


Czech Republic – AB-InBev buys oldest brewery in Budweis

One rival less to use the Budweiser label. AB-InBev has bought the “other” claimant to the Budweiser name, buying the small Budejovicky Mestansky Pivovar located across town from state-owned Budweiser Budvar. AB-InBev confirmed the transaction on 2 July 2014, but did not disclose any terms.

The move to buy the physical facilities comes just three years after AB-InBev acquired the intellectual property (primarily trademarks) of the bankrupt Budejovicky Mestansky Pivovar from Harvestor, a local financier.

Prior to that deal, the owner split the brewery into two packages, the brewery facilities and the intellectual property, and flogged the trademarks off to AB-InBev. With the valued “Budweiser Bier” stripped from the label, Mestansky Pivovar resumed sales under its previous Samson trademark. The brewery had a reported annual production of 175,000 to190,000 hl in 2013.

With this latest deal, AB-InBev has completed its acquisition of the entire brewery and its trademarks. Read on


Belgium – A new brewery group on the horizon?

Someone seems to have a vision. From what we at Brauwelt International have heard, the Dutch private equity vehicle Waterland (Dutch for “waterland”) has set its eyes on buying into privately owned Belgian breweries to establish a group of breweries, much like Duvel Moortgat (Brasserie d'Achouffe, Brouwerij De Koninck, Bernard in the Czech Republic, Ommegang and Boulevard in the U.S.). Waterland reportedly seeks to acquire stakes of at least 50 percent in the breweries.

The plan seems to be to create a portfolio of Belgian specialty beer brands, which already do well internationally. The first brewery to have succumbed to Waterland’s offer is the Bosteels brewery in Buggenhout.

Bosteels brews about 90.000 hl of beer, most of which are exported. Its main brands are Karmeliet, Kwak and Deus.

The deal was announced on 1 July 2014. No transaction details were made public, though. But, from what we have gleaned, Bosteels’ net profit is EUR 5 million (USD 6.8 million). The company has no debts. Insiders reckon it could be valued at EUR 90 to EUR 100 million, considering that a few years back Duvel Moortgat paid EUR 36 million for the De Koninck brewery in Antwerp which then did about 40,000 hl beer.

Whether Waterland has lined up any other breweries at this point is unclear. But as we all know: “money talks”. If other Belgian brewers hear how much Bosteels got, they might perhaps be swayed more easily. Read on


Germany – New “Ambassadors of Beer” appointed by German brewers

More than 300 guests attended the annual meeting of German brewers in Berlin on 25 June 2014. Hosted by the German Brewers’ Association, the highlight of the meeting was the appointment of the new “Ambassadors of Beer". This honorary title was awarded to the TV host Sonya Kraus and the leader of the Green Party, Cem Özdemir. They will bear the title for a year.


United Kingdom - Coca-Cola Enterprises to launch Coca-Cola Life

Coca-Cola’s new stevia-sweetened Coke Life is not out yet, but it’s already courting controversy. Coca-Cola Enterprises (CCE) has announced the launch of Coca-Cola Life in Britain this September. Piloted in Argentina and Chile in 2013, this will be the first time the green-labelled Cola will be available in Europe. Coke’s last brand extension – Coke Zero – arrived in 2006.

According to media, this lower-calorie cola contains a third less sugar and a third fewer calories than regular cola and is sweetened with a blend of sugar and naturally sourced stevia leaf extract. A 330 ml can of Coca-Cola Life contains 89 calories as compared to the 139 calories that are in a can of regular Coke.

Given the public debate over sugar’s negative side-effects, UK health advocates have warned against the new drink, saying that despite the reduced calories the drink still contains four teaspoons of sugar, nearly a quarter of a child's recommended daily intake.

What angered anti-sugar advocates even more is the fact that the UK version of Coca-Cola Life is sweeter than Latin America’s. Read on


India - Diageo takes control of United Spirits

Patience (helped by wads of dollars) eventually paid off. Five years after entering initial takeover discussions, Diageo can finally claim ownership of United Spirits (USL), India’s major drinks company, media reported on 23 June 2014.

Following the successful close of its USD 1.1 billion tender offer on 19 June 2014, Diageo will own 54.7 percent of USL for which it will have paid a total of GBP 1.86 billion (USD 3.2 billion).

Thanks to the GBP 430 million (USD 726.5 million) received from the sale of the Scotch whisky business Whyte & Mackay to Philippine’s Emperador drinks group in May this year - a disposal enforced by the UK’s competition authorities - this outlay will be partially reduced by lowering USL’s debts. Read on


United Kingdom – New rumour that SABMiller will merge with Diageo

SABMiller’s share price has climbed in recent weeks on the rumour that the world’s number one brewer AB-InBev will take it over. Now speculation has been growing that, in order to prevent this from happening, SABMiller, the world’s number two brewer, is planning to merge with the number one drinks company Diageo.

If true, this would not only create a new giant in the Total Beverage Alcohol (TBA) category with a combined turnover of USD 34.4 billion (compared with AB-InBev’s USD 43.2 billion), it would also give SABMiller access to the Guinness beer business and create synergies from using SABMiller’s global beer distribution network. Cost savings, though (as in an AB-InBev-SABMiller deal), would be almost negligible. Analysts put them at perhaps GBP 430 million (USD 740 million).

Many readers will be having a sense of déjà vu. Did not the old Anheuser-Busch back in 2008 attempt to strike a deal with Mexico’s brewer Modelo in a desperate bid stop InBev in their tracks? As we all know, nothing came of that. In the end, Anheuser-Busch was sold to InBev and AB-InBev was created.

That’s why many sober observers say that the latest speculation that SABMiller could patch up with Diageo is merely froth to fill pages of newsprint and fuel market speculation.

Because the real issue has been – and still is: What will SABMiller’s major shareholders - cigarette company Altria and the Colombian Santo Domingo family who control 41 percent - get out of a tie-up with Diageo that they would not get from a deal with AB-InBev? Read on


Russia - Carlsberg refuses to close breweries despite beer market decline

Is it hope over realism that Carlsberg have decided to keep all of their Russian breweries open and running in the face of dwindling capacity utilisations? The beer market in Russia fell by 8 percent in 2013 and 5 percent in the first quarter 2014, media say. In fact, since 2008, beer sales in Russia have declined by 25 percent, hurt by various restrictions on sales and tax hikes, which must have led to many breweries now sitting on huge and costly overcapacities.

It was reported that in the past few years, AB-InBev have closed three breweries and Efes two, while Heineken closed one and put one up for sale, causing Heineken to write off EUR 102 million in 2013 due to the impairment of assets in Russia.

In spite of widespread fears that the beer market will witness another decline this year, Dr Isaac Sheps, who is President of Baltika Breweries and Senior Vice President Eastern Europe of the Carlsberg Group, admitted to media in June 2014 that “it is not easy, we do have empty capacity, but strategically we are trying to hold on to our assets because there is a reason to believe that this market will come back to growth.”

Mr Sheps said that almost none of Baltika’s ten Russian breweries were operating at full capacity but the maker of Baltika and Tuborg beer had faith that Russians would soon return to beer when they had got used to the new regulations and the economic crisis had eased. Read on


Ethiopia – Competition in Addis Ababa’s beer market to heat up

It will be an “all out” rush to the capital’s watering holes once Heineken open their new brewery in Addis Ababa, Ethiopia’s capital and major beer market in July 2014. The brewery in Kilinto, on the outskirts of Addis Ababa, will be Heineken’s third plant in the East African country and will have an annual capacity of 1.5 million hl. It represents an investment of USD 150 million.

Dutch brewer Heineken entered the Ethiopian beer market in August 2011 after acquiring the Bedele and Harar breweries from the state. The breweries, which were purchased for the staggering sum of USD 163 million, had a joint capacity to produce 750,000 hl a year.

The trouble was, these breweries were in locations far away from Addis Ababa and transport represented an expensive and cumbersome challenge. Read on


USA – The industries that Millennials are destroying – including light beer

It’s a provocative thesis, but there’s a lot to be said for watching demographic shifts as businesses forge their long-term strategies. An article by on 23 June 2014 argued that younger Americans don’t like cars, cable TV, or soft drinks – which made Harry Schumacher, the editor of Beer Business Daily write on Twitter “Should we add light beer to this list?”

Although there is no agreement as to who the Millennials are, most researchers and commentators use birth years ranging from the early 1980s to the early 2000s. In the U.S. that’s about 80 million people. As the Baby Boomer population starts its inevitable decline, the power of this age group will grow substantially in the years ahead. Read on


USA – Blame the decline in light beers on Millennials

Light beers are as American as apple pie. After all, they were “invented” by American brewing companies in the 1970s. However, the category seems to be well past its prime. Volumes have been in decline although no one has a single and satisfactory explanation as to why this is so.

U.S. light beers like Bud Light, Miller Lite, and Coors Light are big brands. Beer Marketers Insights says that light beers account for well over half of the volume at both A-B InBev and MillerCoors. Together the two brewers control nearly 97 percent of the light beer segment.

AB-InBev’s brand Bud Light may still be America's best-selling beer - it has been for more than a decade - but retail sales of this and other leading lower-calorie lagers such as Bud Light Lime, Miller Lite, and Natural (aka Natty) Light, dropped in 2013, according to data from IRI, a Chicago market research firm. Not that this spells the end of light beers. Case sales of Coors Light, which became the number two beer brand in the U.S. in 2012, grew nearly 1.8 percent last year, according to IRI.

As the numbers show, the light beer category is under pressure. Previously, some analysts would argue that this is a natural fate affecting all big brands: consumers eventually grow tired of them.

However, I believe that this explanation falls too short. There is a definite trend in the U.S. alcohol segment away from beer towards spirits and wine on top of a shift within the beer category away from lager beers and towards craft beers.

With Americans quaffing more cocktails and wine, beer's share of the overall U.S. alcohol market between 1999 and 2012 has slipped from 56 percent to 48.8 percent (or USD 30.32 billion in gross revenues), while spirits rose to 34.3 percent from 28.2 percent (or USD 21.2 billion) and wine to 16.9 percent from 15.8 percent (or USD 10.53 billion). Read on


Czech Republic - Beer duty cut on the agenda

Czech brewers will be pleased. The Czech agriculture minister Marian Jurečka said at the end of June 2014 that he is considering pushing for a cut in the excise duty on beer.

His motivation for such a move isn’t his new-found love for beer or brewing, though. According to Czech media, the previous hike resulted in a drop in production and tore a hole into the state’s revenues.

Beer duties were raised by caretaker finance minister Edvard Janota in 2010 as part of a package of austerity measures to reduce the state’s deficit.

In 2013 Czech beer production rose slightly but domestic consumption dropped by just over one percent with total sales supported by stronger exports.




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