E-Malt.com News article: India: Anheuser-Busch and Crown Beers India Ltd. to form a joint venture to enter India beer market

Anheuser-Busch International Inc. and Crown Beers announced both companies have agreed to a joint venture to brew, market and distribute Budweiser and other brands in India, according to A-B’s press release, February 22.

The joint venture will operate under the name Crown Beers India Ltd., and includes a new 500,000-hectoliter brewery in the southern city of Hyderabad. The state-of-the-art brewery will be completed in March 2007.

“International expansion is a key part of Anheuser-Busch’s growth strategy, and while India is a small beer market today, it is growing rapidly and has tremendous long-term potential,” said August A. Busch IV, president and chief executive officer of Anheuser-Busch. “This joint venture with Crown brings the experience and skills of both companies together with a world-class brewery to introduce Budweiser to beer drinkers in India.”

Both Anheuser-Busch and Crown Beers will have 50% ownership of the joint venture and will collaborate on all local management, marketing and sales decisions. Crown Beers India Ltd. is expected to employ more than 150 people. Terms of the agreement were not disclosed.

“Budweiser is one of the most popular beer brands in the world and always is associated with unmatched quality and freshness,” said K.V.D. Prasad Rao, joint managing director, Crown Beers. “The joint venture combines Crown’s local business experience with Anheuser-Busch’s global marketing and brewing expertise to reach the consumer who appreciates premium beer.”

While India ranks low among the world beer markets at 8.2 million hectolitres, the country has experienced a compounded annual growth rate of 8% for the past five years. The strong Indian economy, growing at 9% annually, a growing middle class and a young population with 60% under age 30, has contributed to this growth.

“Now is an optimal time for Anheuser-Busch to establish itself in India,” said Stephen J. Burrows, president and chief executive officer of Anheuser-Busch International. “This partnership will enable Budweiser to thrive as India’s beer market continues to grow.”

An Anheuser-Busch brewmaster will oversee local production of Budweiser at the Hyderabad brewery, assuring Budweiser in India has the same crisp, distinctive taste enjoyed by consumers around the world.

“The Hyderabad brewery was designed to uphold Anheuser-Busch’s high standard of quality for brewing Budweiser,” said Srikanth M. Reddy, joint managing director. “Together, the brewery and brand will be symbols of excellence throughout India.”

Budweiser will be available in 330 ml and 650 ml bottles beginning in May 2007 and will be sold by a team of regional and local sales personnel.

Budweiser is an American lager brewed since 1876 using a blend of U.S. and European hops, and a combination of barley malts and rice. Anheuser-Busch uses its exclusive beechwood aging process to help give Budweiser its world-famous crisp, clean taste.

In addition to brewing, the Crown Group operates businesses in India's agriculture industry, through their seed production and export businesses. They also have businesses associated with industrial exports and real estate.

Based in St. Louis, Anheuser-Busch is the leading American brewer, holding a 48.4% share of U.S. beer sales. The company brews the world’s largest-selling beers. Anheuser-Busch also owns a 50%share in Grupo Modelo, Mexico’s leading brewer, and a 27% share in China brewer Tsingtao, whose namesake beer brand is the country’s best-selling premium beer brand. Anheuser-Busch ranked No. 1 among beverage companies in Fortune Magazine’s Most Admired U.S. and Global Companies lists in 2006.


23 February, 2007