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SABMiller PLC - China Acquisitions

RNS Number:9616O
SABMiller PLC
04 January 2007


4 January 2007


            SABMiller joint venture to acquire Blue Sword minorities


China Resources Snow Breweries Limited ('CR Snow'), SABMiller's joint venture in
China with China Resources Enterprise, Limited ('CRE'), has announced that it
has agreed to acquire a 38% equity interest in 14 breweries based in the Sichuan
province in South West China (together the 'Sichuan Breweries') for a total cash
consideration of US$320 million.  The remaining 62% equity interest in the
Sichuan Breweries is already owned by CR Snow.  As part of the transaction, CR
Snow will also acquire the rights to the 'Blue Sword' trademarks, as well as
acquiring a 100% equity interest in the Guizhou Waterfall Brewery Limited ('Blue
Sword Guizhou') in Guiyang City, which has installed capacity of 800,000
hectolitres.


The transaction will be effected via the acquisition of a 100% interest in Blue
Sword (Group) Company Limited or 'Blue Sword Group', a holding company located
in the Shifang City in the Sichuan province. Prior to completion of the
transaction, various non-brewery related assets held by the Blue Sword Group
will be transferred out of the company. For the year ended 31 December 2005,
unaudited net profit attributable to the assets subject to the acquisition
amounted to US$12.4 million, up c. 40% on the previous year.


The Sichuan Breweries joint-venture was formed in October 2001 through a
strategic agreement between CRE Beverage Ltd (now named as China Resources Snow
Breweries Limited) and Blue Sword (Group) Company Limited, creating the leading
brewer in Sichuan. The brewing operations in the region at the time consisted of
12 plants with a further two breweries subsequently added.


Completion of the transaction is expected to take place in early 2007, following
satisfaction of pre-closing conditions.


Mr. Andre Parker, Managing Director of SABMiller Africa & Asia, said; 'This
acquisition further demonstrates CR Snow's commitment to invest in prominent
local brands which not only complements our national branding strategy, but
strengthens our leading positions throughout regional markets.'


Mr. Mark Chen, Managing Director of China Resources Enterprise, Limited said;

'We are very pleased that we can consolidate our brewery interests in Sichuan.
Sichuan is a major profit centre for CR Snow and its contribution has been
rapidly rising on expanding market share.  The acquisition will boost our
operational efficiency in the western and south-western regions and strengthen
our brand portfolio, underscoring our confidence for stronger returns in the
coming years.'


Sichuan province has a population of over 87 million inhabitants and is an area
where beer demand is already strong. The Sichuan Breweries achieved a market
share of c. 70% in the province last year and are well positioned to capitalise
further on increasing demand with additional capacity production facilities
planned. Distribution channels are also well established with an extensive sales
network that covers neighbouring regions such as Chongqing, Yunnan, Guizhou,
Tibet, Shaanxi and Gansu.


Guizhou is a mountainous province, bordered to the north by Sichuan and with a
relatively small population of 39 million people. Despite low current beer
consumption, there is clear opportunity for future growth, particularly through
improving access to the SNOW brand in the local market. At present, CR Snow does
not have a plant in the region, though production of SNOW at the Guizhou brewery
will commence on completion.


Annual production capacity at the Sichuan Breweries in 2005 was 14 million
hectolitres. Construction of additional capacity is currently underway and will
be completed in mid-2007, which will add a further 1.6 million hectolitres to
total capacity. The annual production capacity at the Guizhou brewery was
800,000 hectolitres over the same period.


Ends


Notes to editors:


About China Resources Snow Breweries Limited


China Resources Snow Breweries Limited was established in 1993 and became a
joint venture with SABMiller plc in 1994.  The company is engaged in the
production, sales and marketing of beer and beverages in China.  Its
shareholders are China Resources Enterprise, Limited and SABMiller Asia Limited,
a subsidiary of SABMiller plc.  China Resources Enterprise, Limited has a 51%
interest in China Resources Snow Breweries Limited while SABMiller Asia Limited
holds the remaining 49% interest.  It operates more than 40 breweries in the
Chinese Mainland with a total sales volume of about 39.5 million hectolitres in
2005.


About SABMiller plc


SABMiller plc is one of the world's largest brewers with brewing interests or
distribution agreements in over 60 countries across five continents. The group's
brands include premium international beers such as Miller Genuine Draft, Peroni
Nastro Azzurro and Pilsner Urquell, as well as an exceptional range of market
leading local brands.  Outside the USA, SABMiller plc is also one of the largest
bottlers of Coca-Cola products in the world.


In the year ended 31 March 2006, the group reported US$15,307 million in
revenues and profit before tax of US$2,453 million. SABMiller plc is listed on
the London and Johannesburg stock exchanges.


About China Resources Enterprise, Limited


China Resources Enterprise, Limited is listed on the Hong Kong Stock Exchange
and is also traded on SEAQ International of the London Stock Exchange.  It is
one of the constituent stocks of the Hang Seng Index in Hong Kong.  The Group
focuses on the consumer businesses in both the Chinese Mainland and Hong Kong,
with core activities being retail, beverage, food processing and distribution,
textile and property investment.


This announcement is available on www.sabmiller.com


Enquiries:

                 SABMiller plc                             Tel: +44 20 7659 0100

Sue Clark        Director of Corporate Affairs             Tel: +44 20 7659 0184

Gary Leibowitz   Senior Vice President, Investor Relations Tel: +44 20 7659 0119

Nigel Fairbrass  Head of Media Relations                   Tel: +44 20 7659 0105


This announcement does not constitute an offer to sell or issue or the
solicitation of an offer to buy or acquire securities of SABMiller plc (the
'Company') or any of its affiliates in any jurisdiction or an inducement to
enter into investment activity.

This document includes 'forward-looking statements'.  These statements may
contain the words 'anticipate', 'believe', 'intend', 'estimate', 'expect' and
words of similar meaning.  All statements other than statements of historical
facts included in this announcement, including, without limitation, those
regarding the Company's financial position, business strategy, plans and
objectives of management for future operations (including development plans and
objectives relating to the Company's products and services) are forward-looking
statements.  These forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the actual results,
performance or achievements of the Company to be materially different from
future results, performance or achievements expressed or implied by such
forward-looking statements.  These forward-looking statements are based on
numerous assumptions regarding the Company's present and future business
strategies and the environment in which the Company will operate in the future.
These forward-looking statements speak only as at the date of this announcement.
The Company expressly disclaims any obligation or undertaking to disseminate
any updates or revisions to any forward-looking statements contained in this
announcement to reflect any change in the Company's expectations with regard
thereto or any change in events, conditions or circumstances on which any such
statement is based.

Any information contained in this announcement on the price at which the
Company's securities have been bought or sold in the past, or on the yield on
such securities, should not be relied upon as a guide to future performance.


                      This information is provided by RNS
            The company news service from the London Stock Exchange
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