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Serbia and Montenegro: The sale of a centuries-old brewery has radically changed life in this quiet country town, turning many locals into dinar millionaires in a rare rags-to-riches tale in impoverished Serbia, Reuters wrote on February 27. Property prices shot up and shiny new cars enlivened Apartin's potholed roads after the Belgian beer giant Interbrew bought Serbia's largest beer maker, Apatinska Pivara, last year.

Strengthening its position in ex-Communist eastern Europe, Interbrew in October said it was acquiring the brewery in a deal worth E229 million, or $286.2 million, one of the largest foreign investments in Serbia and Montenegro since reformers toppled Slobodan Milosevic in 2000.

In a country with an average monthly salary of E200, employees of the brewer suddenly found that the shares they received when the plant was privatized in the volatile 1990s were worth a fortune.

"Even by Western standards many of them became rich," said Milan Drazic, mayor of the municipality of 33,000 in Vojvodina province near the Croatian border. He said workers at Apatinska Pivara, which now employs about 650, on average held about 1,000 shares each. Ex-employees and other Serbs who owned stock also benefited. Interbrew at the time said there were up to 7,000 local retail investors in the company.

A stake of 1,000 shares would be worth nearly E170,000, or more than 11 million dinars, under Interbrew's offer of E167.64 a share.

Locals say armored vehicles and special guards were used to transport the money to a local bank from the capital, Belgrade. It turned Apatin, a typical mixture of drab socialist-era high rises and run-down Habsburg-era town houses, into one of Serbia's richest municipalities per capita.

Of 1,400 people in the Balkan state of 7.5 million who declared incomes of more than 700,000 dinars a year, 389 came from Apatin, most of them working at the brewery, Drazic said.

They used their new-found wealth to buy real estate in Belgrade or in Vojvodina's main city of Novi Sad, and cars, of course. "Two years ago you could only see Yugos in Apatin," said Milan Ergarac, a local resident, referring to Serbia's cheap, no-frills vehicle. "Today there is a nice selection of cars."

Shops and restaurants saw increased demand as those who became rich overnight bought the latest television sets and other goods they had not been able to afford before. "An elderly couple came in and asked for the thickest piece of gold we had," recalled a jewelry saleswoman. "It is good for the town but it is only temporary. It will last until they have no money left."

But some Apatin residents who did not own shares complained that the sale of the brewery, established in 1756, had helped only a minority and left most people as poor as ever.

"The town is now divided between a few rich and a majority of poor," said 34-year-old Marko Nikolic, one of the town's roughly 5,000 unemployed. "There is a lot of bitterness."

Mayor Drazic predicted social problems ahead, saying there was a huge difference between the haves and the have-nots. "This is what you get with, for example, a boy of high school age coming to school in a brand new Volkswagen Golf, while his classmate literally does not have enough money to get himself a piece of bread," he said.

Ergarac, who works in a furniture store, and others said few of the newly-rich seemed to invest their funds in production that could create badly needed jobs.

"This way, all the money is basically wasted," he said.

The acquisition gave Interbrew, whose brands include Stella Artois and Becks, control of a third of the market in the countries that emerged from former Yugoslavia.

Interbrew, the world's third-largest brewer, which is also present in Croatia and Bosnia, said the maker of Serbia's popular Pils Light beer was in a good shape and that it planned investments to increase capacity, possibly including other Interbrew brands.

Other brewers in the former Yugoslavia have attracted major foreign interest in the last year, with Denmark's Carlsberg buying the Celarevo brewery for E106.4 million and Turkey's Anadolu Efes taking a majority in the smaller Pancevo plant.


27 February, 2004