Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
Molson Reaching For Foster’s
Bank of America Corp and Deutsche Bank are reported to be the main banks helping Molson; Molson and Modelo are working out an ideal financial offer to take Foster’s into its ambit. However, the details of the joint bid were not disclosed.
Many potential buyers have been planning to acquire Foster’s since it announced plans last year to spin-off its struggling wine operations, which was seen as a deterrent for its growth.
Companies like Japan’s Asahi, Coca-Cola Amatil and SABMiller were the potential buyers, and analysts assume the strong Australian dollar as a possible factor that weakened the allure for Foster’s. However, in February this year, Japan’s Asahi Breweries stated that it had no interest in buying any part of Foster’s.
However, a successful takeover of Forster’s would be one of the biggest deals in the beverage sector.
Foster’s is one of the top brewers in Australia with renowned brands like VB and Cascade and has a 50% market share of Australia. Therefore, the deal if successful will not only be a strategic fit to the companies in terms of portfolio addition but will also give them the exposure to the high potential Australian market.
However, analysts feel that the Molson and Modelo team up is not very promising for the takeover as the partnership would cost Molson highly since the Mexican brewer is half-owned by Anheuser Busch InBev (NYSE:BUD), the world’s largest brewer.
Analysts apprehend that Anheuser-Busch InBev may block any such deal that enhances the value of Modelo and make the outright ownership of Modelo difficult for the former in the near future.
Analysts are of the opinion that SABMiller, Molson Coors’ majority partner in the Miller Coors joint venture in the U.S, is more likely to be a part of the team in swallowing the Foster’s Group.
We remain encouraged by the restructuring initiatives taken by Molson to reduce overhead costs and boost profitability. The initiatives include closure of underperforming breweries and efforts to attain efficiency in finance, administration and human resource activities. However, seasonal nature of the business of Molson Coors and increased competition from Anheuser-Busch InBevare concerns.
7 Jun. 2011