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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.

Thai takeover opens exit door for coveted F&N chairman Lee

Lee Hsien Yang, the brother of Singapore's prime minister and chairman of Fraser and Neave Ltd (F&N), will enter a new chapter in his corporate life - and could well leave F&N - as the group looks set to be taken over by Thailand's third-richest man.
Lee, 55, the second son of Singapore's founding leader Lee Kuan Yew, oversaw a bidding war for F&N that led to Southeast Asia's biggest corporate takeover. The deal values the 130-year-old drinks and property conglomerate at around $11 billion and will reward shareholders handsomely.
Despite some friction with Lee's board, there are compelling reasons for Charoen Sirivadhanabhakdi to keep on the astute, well-connected scion as the Thai beer baron looks to unlock value from F&N's drinks business, distribution networks and premier properties.
"He will leave F&N - that's my sense," said Mano Sabnani, a minority shareholder and former senior executive at a Singapore newspaper. "If they wanted him and they asked him then maybe. But Hsien Yang is a very capable chap. For him to get other roles is not a problem."
Lee's future is sure to be a hot topic at a shareholder meeting on Tuesday.
Lee holds 180,000 F&N shares directly, a company filing showed in December, and he is one of three trustees of 408,240 shares held by the estate of Kwa Siew Tee. Kwa is the late father-in-law of Lee Kuan Yew.
Another filing from 2007 shows Lee Hsien Yang bought the direct shares on November 23 of that year at S$5.65 each. At the Thai takeover price of S$9.55 per share, he will make a profit of S$702,000 ($571,600) if he sells to the Thais.
If Lee does leave F&N, the impact will be minimal as the senior management is intact and the business carries on, said a source close to the transaction, speaking on condition of anonymity.
"I'm sure he's considering his options," said the source. "Fraser is a very old brand, so the connections are all there, the management are all there. The business is beyond one individual."
In 2007, Lee surprised the region's corporate world, and his father, with his departure from Singapore Telecommunications Ltd after 12 years as its chief executive.
Lee, who is also chairman of the Civil Aviation Authority of Singapore and a director of bourse operator Singapore Exchange Ltd and Australian and New Zealand Banking Group Ltd , declined to comment or be interviewed.
"He would be one of the sought-after global CEOs, but the question is whether he would like to leave Singapore," said a senior investment banker. "His wife is one of the best lawyers in town... They are a power couple."
Lee's wife Lee Suet Fern is a senior director at Stamford Law Corp, F&N's main legal advisor on the takeover deal by the Thais and the group's sale of its prized Tiger Beer asset to Heineken NV in September.
Lee streamlined F&N's management by naming two CEOs to run the drinks and property divisions as it was difficult to find one person good at both market segments, said Jit Soon Lim, Nomura's head of equity research for Southeast Asia, who has covered F&N since 1997.
"The question is not so much where he ends up but what he wants to do," said Lim. "If F&N is fully privatized, then there is no role for him as a chairman."
F&N's board was exploring options to restructure the group and unlock value even before Charoen's interest accelerated the process, but it would have taken time and carried some risks to execute, said another source who is close to the transaction.
"Here it's a sprint forward, there's certainty and time-value for money," said the source.
"We should not underestimate the contribution of the chairman in this process," the source said. "The value has been realized and the new owner - who has got more money than you know what to do with - has to decide which is his best team."
A spokesman for both TCC Assets Ltd and Thai Beverage PCL , through which Charoen is buying all of the F&N shares that he does not already own, declined to comment on their plans for the Singapore conglomerate.
Charoen and Lee have been in close contact, but relations have not always been smooth since the Thai magnate lost out to Heineken and turned his attention to F&N itself.
Last year, Lee played the role of mediator as Charoen's battle with Heineken over Asia Pacific Breweries Ltd risked turning ugly, taking a call from the Thai billionaire in mid-September, sources close to the deal have said.
After that conversation, Charoen called Heineken to say his group would accept the Dutch giant's bid to buy F&N and other shareholders out of the Tiger beer maker, leaving the Thais to go after F&N's soft drinks and property businesses.
But Charoen shot down the F&N board's proposal to pay S$4 billion to shareholders as he prepared to bid for control.
The board's decision to agree to a break fee for a rival bidder - a consortium led by Indonesian tycoon Stephen Riady's Overseas Union Enterprise Ltd - also did not sit well with the Thais, two sources with direct knowledge of the matter said.
Lee, who was paid S$1.59 million last year, heads a nine-member F&N board that is a diverse group of powerful people.
They include Hirotake Kobayashi, managing director of Japanese food and drinks company Kirin Holdings Co Ltd <2503.T>, which owns about 15 percent of F&N and backed the Riady-led counter-bid.
Other prominent F&N board members are Timothy Chia, the Asia chairman of Coutts & Co Ltd, Tan Chong Meng, group chief executive of PSA International, one of the world's largest port operators, and Maria Mercedes Corrales, a former senior executive at Starbucks Coffee Co and Levi Strauss & Co in Asia.
The current board could be embraced by Charoen, minority F&N shareholder Sabnani said, "but my feeling is there are going to be major changes."

29 Янв. 2013



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