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3-2019

Russia: Positions of Brewing Companies

The review contains an analysis of interim performance of brewers in the first half of 2019. There are rather dynamic changes behind a modest industry growth. Baltika is again experiencing a stage of volumes and market share slid due to competition with AB InBev Efes. Because of the price competition and presence expansion in the modern trade company #2. has come close to the leading position. At the same time sales of Heineken Russia have continued growing which makes the premium part of the portfolio heavier. The market premiumization trend had been also confirmed by import brands. MBC and Zavod Trekhsosenskiy have been the most successful among federal market players. The market share of independent regional brewers and Ochakovo have continued falling as they are being squeezed out by the market leaders at their competitive fields.

Ukrainian beer market 2019: companies and brands

In 2019 beer production and market have been still fluctuating about zero point. However, the past season was successful for brewers judging by the sales profitability. The price mix has improved due to rapid general market premiumization, as well as its particular aspect, the growth of import beer sales. By the season end AB InBev Efes improved its positions considerably. It turned out that consumers had not forgot Efes brands that had to leave the market, but started to recover rapidly. Against the stagnating market that meant sales decline of other companies, in the first place Carlsberg Group that most of all beneficiated from Efes exiting the market. PPB turned out to be stable to branding activity of its competitor and Obolon kept the same volumes and at the moment it is the absolute leader of the economy segment. The share growth of independent producers took place thanks to leading craft breweries, that so far do not have a big market weight, but they are rapidly gaining it.

Brewing industry in Kazakhstan 2019

During the first half of 2019, the majority of Kazakh brewers made their contribution into positive dynamics. Yet it was companies of the lower division, not the two transnational leaders that raised their production and sales. The shares of draft beer and aluminum can which is rapidly squeezing glass bottle out of the market, have been growing. The price segmentation has remained stable despite the substantial rise of retail prices and fluctuations of brand market shares, while the borders between segments have become blurred. The main events in the industry have been: the announced revision of the beer excise policy, launch of BeerKhan brand in the strong beer segment, and most important – purchasing assets of Shymkentbeer by Arasan.

Merger headache brewing for Busch

Regulators will soon ask Anheuser-Busch InBev — the world’s biggest brewer — to make major concessions to complete its $19 billion buyout of Grupo Modelo, a well-placed source said.

Critics of the deal believe allowing Busch, with its Budweiser and other brands owning approximately 47 percent of the US beer market, to buy Modelo, whose Corona and 11 other brands control 6 percent, will give it too much pricing power.

Busch, sensing regulatory troubles, said in July it would give importer Constellation Brands the right to import all of Modelo’s beers and set distribution and pricing. But the offer appears to be one the DOJ can refuse.

There is a meeting of the regulatory cops at Justice this week and, the source said, Busch may be forced to have a third party make all beers imported into the US.

“It’s going to come down to how much Busch is willing to give up,” the source said. “They are going to have to create another competitor.”

Anheuser-Busch InBev already has 14 brands with sales of at least $1 billion each — and Modelo has three.

A banker said he believed Busch was ready to give in if the DOJ were to order Modelo’s US imports to be produced by a third party.

Perhaps that’s because ABInBev is not necessarily after Modelo’s US market share — but its 59 percent control of the Mexico beer market. Modelo, according to ABInBev, is also the leading import beer in 38 countries. Conversely, the US beer market is stagnant, with shipments eking out a small gain last year after three straight annual declines.

In its presentation to investors, Busch also says the deal will create at least $600 million in annual cost synergies, phased in over four years.

The DOJ, with jurisdiction only in the US, cannot place conditions outside the domestic market.

A Busch spokeswoman said the company is not commenting on the review and continues to expect the merger to close at the end of the first quarter. The DOJ declined to comment.

15 Янв. 2013

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