24th Jul 2006 08:30
SABMiller PLC24 July 2006 SABMiller associate announces acquisitions in Zhejiang and Anhui provinces in China London and Johannesburg, 24 July 2006. China Resources Snow Breweries Limited("CR Snow"), an associate of SABMiller plc and a subsidiary of China ResourcesEnterprise, Limited ("CRE"), announces that it has agreed to acquire a 100%equity interest in Zhejiang Yinyan Brewery Company Limited or "Yinyan Brewery"for a cash consideration of US$42.3 million. In addition, CR Snow will acquirethe brewing related assets of the Anhui Huaibei Xiangwang Brewery CompanyLimited or "Xiangwang Brewery" for a consideration of US$10.1 million. Situated in the Haiyan county of Zhejiang Province on the east coast of China,the Yinyan Brewery is well positioned to further extend CR Snow's footprint innorthern Zhejiang, an area which is close to a number of major cities includingShanghai, Hangzhou, Suzhou and Ningbo. Similarly, Xiangwang Brewery is based inHuaibei, a major city in northern Anhui. Upon acquisition, our national brand "SNOW" will be produced as soon as practicable. At present, CR Snow has twobreweries in Zhejiang Province and five breweries in Anhui Province, with 2005sales volumes of 2.9 million hectolitres and 4.9 million hectolitresrespectively. Both breweries are strategic acquisitions in the development ofCR Snow's footprint in China. Incorporating Yinyan Brewery's net debt of US$6 million and CR Snow's intentionto invest an additional US$1.8 million, the total investment cost in YinyanBrewery is expected to be approximately US$50.2 million. The current annualproduction capacity of the brewery is 1.8 million hectolitres and this will beincreased to 2.4 million hectolitres after undergoing the planned investment.At present, the portfolio is focused on the "Yinyan" series of beers, which aredistributed in the Jiaxing area of Zhejiang; and in Shanghai. In 2005 theYinyan Brewery sold approximately 1 million hectolitres of beer. The consideration for the acquisition of Xiangwang Brewery is based on appraisedasset value, with an intended further investment of US$7.4 million, bringingtotal investment cost to approximately US$17.4 million. The annual productioncapacity of the brewery will be upgraded from 930,000 hectolitres to 1.6 millionhectolitres. At present, the brewery's main brand "Xiangwang", has a dominantmarket share in Huaibei and in 2005 the brewery reported sales volume of about650,000 hectolitres. Mr. Andre Parker, Managing Director of SABMiller Africa & Asia, said, "We have aprofitable and growing presence in Zheijiang and Anhui. Therefore theseacquisitions will not only effectively reinforce CR Snow's market position inthese provinces, but provide a larger platform to expand our national brand SNOWin these strong growth areas." Mr. Mark Chen, Managing Director of China Resources Enterprise, Limited said, "The two acquisitions play a crucial role in the strategic development of CRSnow in these areas. Yinyan Brewery will generate synergies with our existingbreweries at Qianjiang and Xiling, cementing a strong network in the northernregion of Zhejiang Province. It will also provide us direct access to theShanghai market given its proximity to the city. Whilst at the same time,acquisition of Xiangwang Brewery will establish CR Snow's production base innorthern Anhui and add to our dominant market position in the province." Ends Notes to editors About China Resources Snow Breweries Limited China Resources Snow Breweries Limited was established in 1994 and is engaged inthe production, sales and marketing of beer and beverages in China. Itsshareholders are China Resources Enterprise, Limited and SABMiller plc. ChinaResources Enterprise, Limited has a 51% interest in China Resources SnowBreweries Limited while SABMiller plc holds a 49% interest. It operates about40 breweries in the Chinese Mainland with a total sales volume of about 39.5million hectolitres in 2005. About SABMiller plc SABMiller plc is one of the world's largest brewers with brewing interests ordistribution agreements in over 60 countries across five continents. The group'sbrands include premium international beers such as Miller Genuine Draft, PeroniNastro Azzurro and Pilsner Urquell, as well as an exceptional range of marketleading local brands. Outside the USA, SABMiller plc is also one of the largestbottlers of Coca-Cola products in the world. In the year ended 31 March 2006, the group reported US$2,626 million adjustedpre-tax profit and a turnover of US$15,307 million. SABMiller plc is listed onthe London and Johannesburg stock exchanges. This announcement is available on www.sabmiller.com About China Resources Enterprise, Limited China Resources Enterprise, Limited is listed on the Hong Kong Stock Exchangeand is also traded on SEAQ International of the London Stock Exchange. It isalso one of the constituent stocks of the Hang Seng Index in Hong Kong and HangSeng London Reference Index. The Group focuses on the consumer businesses inboth Hong Kong and the Chinese Mainland, with core activities being retail,beverage, food processing and distribution, textile and property investment. 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 James Crampton Media Relations Manager Tel: +44 20 7659 0172 This announcement does not constitute an offer to sell or issue or thesolicitation of an offer to buy or acquire securities of SABMiller plc (the"Company") or any of its affiliates in any jurisdiction or an inducement toenter into investment activity. This document includes "forward-looking statements". These statements maycontain the words "anticipate", "believe", "intend", "estimate", "expect" andwords of similar meaning. All statements other than statements of historicalfacts included in this announcement, including, without limitation, thoseregarding the Company's financial position, business strategy, plans andobjectives of management for future operations (including development plans andobjectives relating to the Company's products and services) are forward-lookingstatements. 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 fromfuture results, performance or achievements expressed or implied by suchforward-looking statements. These forward-looking statements are based onnumerous assumptions regarding the Company's present and future businessstrategies 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 disseminateany updates or revisions to any forward-looking statements contained in thisannouncement to reflect any change in the Company's expectations with regardthereto or any change in events, conditions or circumstances on which any suchstatement is based. Any information contained in this announcement on the price at which theCompany's securities have been bought or sold in the past, or on the yield onsuch 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 ExchangeRelated Shares:
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