On 2 December, Carlsberg officially pulled out of Russia. After more than two years of agony and uncertainty, things happened quickly. First, President Putin signed a decree, which gave back control of Baltika Breweries to Carlsberg. The following day, Carlsberg agreed to a management buyout by two brewery executives. Most likely, Carlsberg’s Russian nemesis, Taimuraz Bolloyev, has had a hand in it too, according to a rumour the Russian news outlet Wedomosti has picked up. Mr Bolloyev, a long-time judo friend of Mr Putin’s, ran Baltika between 1991 and 2004 as if it were his personal fiefdom. After the seizure of Baltika in July 2023, he was reappointed by Mr Putin as Baltika’s president. The buyout deal is valued at USD 322 million. That’s peanuts considering the size of Baltika’s business. But it’s more than what Heineken got when it sold its Russian business to Arnest in 2023: one euro.
Speaking of which: when Heineken and Carlsberg jointly acquired the brewer Scottish & Newcastle in 2008 for USD 15 billion, only to split it up between them, the rationale for Carlsberg was to obtain the other half of Baltika it did not own yet. That’s because Baltika was immensely profitable – so much so that, at its peak, it accounted for more than half of Carlsberg’s profits and the late beer economist, Germain Hansmaennel, jokingly called Carlsberg “a Russian brewery with European subsidiaries”. When subsequently things took a turn to the worse, as the Russian government clamped down on alcohol and beer sales dropped, Baltika’s profit contribution dwindled dramatically. By 2021, it accounted for only 6 percent of Carlsberg’s total profits. Taking the long view, you could say that Heineken did better out of the Scottish & Newcastle deal. But, as always, hindsight is easier than foresight.
Russia approves USD 322 million management buyout of Baltika. The rock bottom transaction price reflects Russia’s tightened rules for foreign exits. Per reports, Russia now requires from a seller a significant discount of 60 percent and an “exit tax” of 35 percent. Carlsberg’s net assets in Russia were valued by independent Russian analysts at a minimum of USD 5 billion in 2024, indicating a steep markdown. The number two brewer in Russia, with a market share of perhaps 27 percent, has eight breweries and employs more than 8 000 people. It produced an estimated 21 million hl beer in 2023. The Russian news agency Tass put Carlsberg’s accumulated losses from its Russia exit at USD 6 billion.
Beer in Russia’s stadiums? Baltika Brewery has spoken out in favour of the return of beer to Russian football stadiums. Playing down any self-interest, Baltika said that this would not open up an additional sales channel for breweries, but only increase the number of spectators at matches. The ban was introduced in August 2005. A year earlier, the advertising of beer in stadiums and on television was severely curtailed. During the 2018 FIFA World Cup, the ban was temporarily lifted. Since then, the idea of returning alcohol to the stadiums has been discussed more than once. This time round, Baltika’s initiative has greater chances of success. For one, Carlsberg’s former unit has since been sold and become Russian-owned. For another, Russia’s Ministry of Finance seems to support the initiative.
In a landmark move, BrewDog has announced a partnership with Marylebone Cricket Club (MCC) to be the Official Beer Partner at Lord’s Cricket Ground. Starting in January 2025, the sponsorship is to run for four years. Lord’s Cricket Ground is famous the world over as “the home of cricket”. It is the first sports venue in the UK to hand over its taps to a craft beer brand. Lord’s serves around 750,000 pints in a year. BrewDog is taking over from Marston’s, which held the sponsorship and supply partnership with MCC since 2008. The Scottish brewer, founded in 2007, has come a long way. In 2011, founders James Watt and Martin Dickie – like an invading army – drove a tank down Camden High Street to mark their arrival in London. Fourteen years later, they will join the temple of the English establishment. When BrewDog started out, the punks at its helm gave the finger to the old farts in the brewing industry. And now they are sponsoring Lord’s. Is this a cynical case of “If you can’t beat them, join them”? Or is this just another step in BrewDog’s grand sell-out?
US craft beer sales declined in 2024. In the Brewers Association’s midyear survey, craft beer saw a 2 percent decline in production, which was steeper than in the full year 2023 (-1 percent). In the second half of this year, beer sales continued to slow down, suggesting a full-year number that may be weaker than the midyear estimate. There were 9,736 small and independent breweries in operation in 2024. The industry saw 335 new brewery openings and 399 closings. Despite the slight decline in the number of breweries, closings remain a low percentage of total operating breweries. All in all, the craft beer industry supported nearly 460,000 jobs and contributed an estimated USD 77.1 billion to the US economy.
Portugal’s Super Bock group opened a craft brewery in Lisbon. It must be the first time in the industry that a country’s leading brewer opens a craft brewery – not to cash in on a growing trend, but to promote beer culture overall. This is what Super Bock Group hopes to achieve, after investing EUR 4 million (USD 4.2 million) in a former military power plant to establish Browers Beato in Lisbon. The name – a compound word of Brothers and Brewers – signals its intention. “Browers is not to make a profit for the company. It is to make a profit for the category,” explained Tiago Brandão, project director of The Browers Company, a unit of the Super Bock Group, and responsible for Browers Beato. It is above all a relationship project, he added: between the brewery and the restaurateur, between Browers and other friendly brewers, between Browers and the people of Lisbon. Consequently, the majority of taps will be given to guest beers, while Browers’ own beers will initially be available on-site only. And no, Browers is not going to be turned into a chain, Mr Brandão insisted.
Delta Corp’s monopoly in the Zimbabwean beer market could fall. The Dutch family-owned brewer Royal Swinkels (formerly known as Bavaria) is exploring options to build a 200,000 hl brewery in the country, people close to the matter said. The project is at an advanced stage, they added. With beer consumption continuing to decline in Europe, the number two brewer in the Netherlands has been expanding its footprint overseas. In Africa, there are many countries where there are only one or two breweries, and that’s where the Swinkels prefer to settle. Although the site of the brewery is still unknown, insiders said it could be located in or near the city of Kwekwe, half way between the capital of Harare and the city of Bulawayo, where Delta Corp operates two lager breweries. The Kwekwe location would make sense, not least in terms of logistics, because there are a lot of farms in the area which grow barley. Delta also has a malting plant in Kwekwe.
Molson Coors buys Chicago brewer Cruz Blanca. Just when we thought that Molson Coors had exited craft beer for good by selling its remaining craft breweries to cannabis firm Tilray, Molson Coors is back in the game. At the end of November, it acquired the Chicago-based brewery Cruz Blanca. Financial details were not disclosed. What’s the beauty of Cruz Blanca in the eyes of Molson Coors? Most likely its small size and national potential. Its beers might benefit from being produced domestically at Molson Coors’, should Mr Trump stick to his threat and impose 25 percent tariffs on imports from Mexico on his first day as president (20 January). The tariffs could make Constellation Brands’ imported Modelo beers comparatively more expensive, and punters might grab a Cruz Blanca instead.
Sapporo-Stone axes global export business. What has become of Stone, whose founder, Greg Koch, several years ago built a brewery in Berlin to preach German punters the gospel of craft beer? Both Mr Koch and the Berlin brewery are gone. In fact, as of January 2025, Stone from San Diego will be a domestic business only, having pulled out of all 50 of its export markets. Behind the decision lies a change in ownership and strategy. The brewery, founded in 1997, was sold to Sapporo in August 2022 for USD 165 million and has since been renamed Sapporo-Stone. Its international export business has dwindled to about 1 percent of its total sales. Further signs of the company’s new direction came in October, when it announced the discontinuation of some special releases, indicating that the speciality beer market was no longer considered key to its business.
Big Brewers and US craft brewing: the romance is over. The announcement that AB-InBev will close Elysian’s production brewery in Seattle, effective 31 December, led to a lively debate over AB-InBev’s motives. Some observers speculated that it was the decision by a group of 30 workers at the facility to join the Teamsters union in August 2023, which mightily displeased its owner. When the workers decided to go on strike in October over protracted contract negotiations, AB-InBev retaliated by shuttering the brewery. The insinuation does not stand up to reason. Thousands of AB-InBev’s workers in the US are unionised.
More likely, the closure is an attempt to trim margin-diluting units. Besides, operating several small-scale breweries, while there is plenty of excess capacity in the system, would not have gone down well with Wall Street. Surely, AB-InBev will have no trouble brewing Elysian beers at one of its several macro breweries. Reportedly, beer output at Elysian’s production brewery was 50,000 barrels.
Heineken to build a brewery in Dubai. For a long time, alcohol was banned in Dubai, then taxed at an extremely high rate. Last year, regulations were slightly relaxed. Now Dubai is poised to get the Gulf’s first brewery. Sirocco, a joint venture of Heineken and Dubai-based Maritime and Mercantile International (a subsidiary of the state-owned Emirates Group), will start construction in late 2025 and aims for an opening in 2027. Although the size of the brewery was not disclosed, media reported that it will produce brands including Heineken, Kingfisher, Amstel and Birra Moretti.