Global brewing giant SABMiller’s Russian operations are to invest approximately $$170-million in the construction of a new brewery outside the city of Ulyanovsk, which is located about 1Â 000km east of Moscow.
Ulyanovsk, which lies on the Volga River, enjoys good road and rail links and is home to a number of raw-material suppliers.
The new brewery, which will have an initial capacity of three million hectolitres, is expected to be operational in early 2009 and will complement the group’s existing brewery in Kaluga, which is located some 180km south-west of Moscow, SABMiller said in a statement on Thursday.
SABMiller’s business in Russia has enjoyed compound annual volume growth of approximately 30% over the last five years, and its Kaluga site has now been expanded to a capacity of three million hectolitres.
Both breweries will produce SABMiller’s Russian brands, including Zolotaya Bochka (Golden Barrel), Miller Genuine Draft and Velkopopovicky Kozel; which together comprise three of Russia’s top 10 leading brands in the premium segment, it said.
“Russia remains a strategically important market for SABMiller and this investment will enable us to maintain our strong growth profile in the premium segment, whilst optimising our transport costs and at the same time improving our service levels to distributors and big retailers,” said Alan Clark, managing director of SABMiller Europe.
SABMiller’s current market share in Russia is 6% on a volume basis, or an estimated 15% of industry profitability. In the year to March 2006, the company generated volume growth of 14% in Russia, twice the rate of the market. — I-Net Bridge