SABMiller now in Namibia

**Mie1** · 8th September 2009, 03:55 PM

SABMiller Plc won a license to open a brewery in Namibia reports the BLoomber news site, taking the fight for control of southern Africa’s beer market to the home of competitor Namibia Breweries Ltd.

SAB will invest in the brewery through a new subsidiary, SABMiller Namibia Ltd., the London-based company said in an e- mailed statement today. The maker of Castle Lager and Carling Black Label has been importing beer into Namibia, where it controls about 22 percent of the market. Namibia Breweries sells Windhoek Lager, a premium beer, and Heineken into South Africa to compete with SAB brands.

SAB has been seeking local brewing rights for the past decade in Namibia, a market dominated by Namibia Breweries, in turn 29 percent owned by SAB’s international competitors, Diageo Plc and Heineken NV.

“SABMiller are putting their beers into Namibia to say we can sell beer in your back garden too,” Chris Gilmour, an analyst with Absa Asset Management Private Clients, said in an interview from Johannesburg today. “It’s upping the stakes in the southern African beer wars. The sparks are going to fly.”

Namibia has a population of about 2 million while almost 50 million people live in South Africa.

Tanzanian Spat

SAB, Diageo and Heineken are fighting for control of Africa’s beer markets. SABMiller won a court ruling in the U.K. last month that prevents Diageo’s East African Breweries Ltd. unit from buying Serengeti Breweries Ltd. in Tanzania until arbitration is completed.

Namibia Breweries has a partnership with Diageo and Heineken through a company called Brandhouse Beverages Ltd. that sells into South Africa, Gilmour said, which “is enough of an irritant” for SABMiller.

Opening a brewery in Namibia will allow SABMiller to sell beer in Namibia in returnable bottles for the first time. “That is where you get the big savings and cost advantages,” Gilmour said, adding that most of the beer SAB sells in South Africa is sold in returnable bottles. Currently SAB trucks beer to Namibia.

“SABMiller has the economies of scale to produce beer very cheaply,” Gilmour said. “I suspect they may undercut Nambrew and give Namibia a big variety of beer, and will probably bring in things like Peroni Nastro Azzurro” to compete with Windhoek.

SAB didn’t say when its Namibian brewery will be built Or how big it will be. Beer consumption in Namibia is still “moderate” at 40 liters (10.6 gallons) per capita annually, SAB spokesman Nigel Fairbrass said by telephone. Consumption in South Africa, is about 56 liters per capita.

“The Namibian government’s decision to grant us this license is a milestone,” Cobus Bruwer, managing director of SAB’s Namibia unit, said in the statement. “When the plant is operational, we expect to contribute significantly to the Namibian economy.”

Brandhouse is expected to open a 3 million hectoliter brewery near Vereeniging, south of Johannesburg, this year to sell beer in South Africa.

“The timing is fantastic,” Gilmour said.

Bloomberg

**Comrade007** · 9th September 2009, 11:26 AM

So SAB Miller has finally made it into Namibia after all these years. If anything the company is persistent. I suppose that ends the "when is a beer a beer" debate, but I'd still like to know whether it's only a bottling plant or a full-blown brewery.

I also think it was right at the time for Namibia Breweries to enjoy a measure of protection, given the fact that SAB Miller basically swallowed similar independent brewers all over Africa. That would have been detrimental to the devleopment of Namibia Breweries as one of few high-tech manufacturing companies in our Republic.

But the game has changed with the alliances that Namibia Breweries has struck with other international companies. I for one will continue to drink my Tafel and WIndhoeks, though, simply because they are better beers - I've never trusted the chemical brews that SAB Miller puts together.

So why not join my I enjoy my Windhoek group here and shout out for our very own Namibian quality beers!

**Papa** · 21st September 2009, 06:27 PM

its good let the be changed, we are supporting you.

**theman** · 3rd October 2009, 11:10 PM

Yeslaiik Comrade_007 ek lyk jou groep en het sommerr gejoin. Ek geniet ook 'n Windhoek hier en 'n Windhoek daar! Maar waar's al die ander manne! Kom kruip uit julle gatte uit en raise 'n glas vir Windhoek!!!

**4_sure** · 28th April 2010, 03:38 PM

its good we need work

**Mie1** · 1st May 2010, 08:35 AM

Like a clinging vine they (allegedly) have the reputation of killing their host

**Comrade007** · 4th May 2010, 12:23 PM

Here are more details of their plans, as reported by Afrol.com:

SAB takes Namibia’s beer market competition head-on
afrol News, 23 April - Communities of the northern regions of Namibia will become direct shareholders in the new venture announced by SABMiller to increase its market share in the country.

SABMiller has announced it is putting up a $34 million brewing facility with a 220,000 hectolitre capacity in the northern part of the country, some 70kms from the capital, Windhoek.

The company has said the project is expected to kick-start in the second half of this year, with 40 percent of the stake being taken by local ventures.

“The new brewery will be owned by a venture in which SABMiller will own a 60% stake and local partners the remainder as part of a black empowerment initiative. The company said as part of black economic empowerment there will be 20% ownership by Onyewu Investments and 20% by three charitable trusts working on behalf of communities in the Omaheke, Karas and Northern regions of Namibia,” the company explained in a statement today.

It further said the brewery will produce the Castle and Castle Lite brands, and include a returnable bottle packaging line and warehousing facilities.

The announcement by the SABMiller follows on the Namibian competitors’ expansion into the South African market recently.

Namibia Breweries last month officially opened the Sedibeng brewery south of Johannesburg (South Africa) with European partners Heineken NV and Diageo PLC, brewing its Windhoek lager alongside Heineken, Amstel and Smirnoff Storm and Spin blended drinks. The three have been gaining market share at the premium end of South Africa’s beer market, strongly challenging the SABMiller’s dominant hold.

"We have been importing beer into Namibia for over 20 years and such a significant investment symbolises our current optimism in the country," said Cobus Bruwer, SABMiller’s country representative.

He said SABMiller currently has an estimated 22 percent local market share in Namibia with brands such as Castle, Carling Black Label and Peroni Nastro Azzuro.

Namibia is said to be one of the biggest beer markets in the Southern African region, especially because of its ties and influence of the German tradition.

By staff writer

© afrol News