18 March 2004
18 March 2004
SABMiller announces new joint ventures with Castel Group in Algeria and Morocco
SABMiller plc today announces the establishment of two separate joint ventures
with its pan-African partner the Castel Group ('Castel') in the French speaking
territories of Algeria and Morocco (collectively 'the transaction').
The Algerian joint venture has been effected by SABMiller acquiring a 25% direct
interest in two Castel carbonated soft drink plants and one brewery in Algeria,
together with a 15.78% stake in a second brewery, in which Castel is a majority
shareholder. The Moroccan joint venture has been effected by SABMiller
acquiring a 25% interest in a holding company which has controlling interests in
three breweries, a malting plant and a wet depot in Morocco. As a consequence
of these investments by SABMiller and its existing 20% stake in Castel's
operations in Africa, these joint ventures are effectively owned 60% by Castel
and 40% by SABMiller.
The day-to-day operations of the joint ventures will be managed by Castel, which
has a significant presence and expertise in French speaking Africa. The parties
will co-operate in a number of important areas such as procurement and new
technical initiatives, whilst drawing on the resources of the respective groups.
In the year ended 31 December 2003 the joint venture businesses included in the
transaction generated sales of US$86 million, comprising 1.2 million hectolitres
of lager beer and 900 000 hectolitres of carbonated soft drink.
SABMiller's direct investment in the joint venture businesses comprises US$25
million in the Algerian joint venture and US$21 million in the Moroccan joint
venture. The initial impact of the transaction on SABMiller's earnings and
gearing is expected to be neutral.
Graham Mackay, Chief Executive of SABMiller, said: 'We are delighted to have the
opportunity of cementing our strong relationship with the Castel Group of France
through the establishment of the Algerian and Moroccan joint ventures. The
pan-African strategic alliance between our groups has progressed from strength
to strength, and the underlying operations have performed admirably in often
Pierre Castel, Chairman of the Castel Group, commented: 'It was always the
parties' intention to enter into joint ventures where new opportunities could be
exploited, and certain opportunities were earmarked at the time the strategic
alliance was formed. We are pleased that SABMiller will join us in the
development of these businesses which have significant potential, and also look
forward to other joint ventures with SABMiller in Africa.'
Notes to Editors
Algeria - Carbonated Soft Drinks
In Algeria the joint venture companies producing and distributing carbonated
soft drink are Societe de Boissons de l'Ouest, Algerien ('SBOA'), situated in
Oran, and Skikda Bottling Company ('SBC'), situated in Skikda.
The size of the carbonated soft drink market in Algeria is approximately 5
million hectolitres per annum, 2 million hectolitres of which is supplied by
smaller bottlers. The joint venture produces and distributes 'Coke', 'Fanta',
'Sprite' and 'Fresca' and commands a 31% market share among the larger
distributors. The two joint venture carbonated soft drink companies have a
capacity of approximately 2 million hectolitres per annum.
Algeria - Beer
The joint venture companies brewing and distributing beer are Societe des
Nouvelles Brasseries ('SNB'), situated in Oran, and Algerienne de Bavaroise
('Albav'), situated in Wilaya Taref.
The size of the beer market in Algeria is approximately 900 000 hectolitres per
annum. The joint venture produces and distributes the brands 'Shems', '
Bavaroise', 'Beaufort', 'Castel Beer' and '33 Export' and already commands a 29%
market share. The two joint venture brewing companies together have the
capacity to brew 500 000 hectolitres per annum which could be increased by 200
000 hectolitres per annum with minimal additional investment.
Currently, there is low per capita consumption across both the carbonated soft
drink and the beer industries with both industries facing good growth prospects.
The Algerian joint venture controls the entire issued share capitals of SBOA,
SBC and SNB and 63% of the issued share capital of Albav.
Morocco - Beer
The joint venture company in Morocco is Marocaine d'Investissements et de
Services ('MDI'), situated in Casablanca. MDI owns a 54% interest in Societe
des Brasseries du Maroc ('SBM') a company listed on the Casablanca Stock
Exchange which brews and distributes beer under the following brands 'Castel',
'33 Export', 'La Gazelle', 'Special Flag', 'Stork', 'Flag Pils', 'Casablanca',
'Kania' and a non-alcoholic beer 'Crown'. SBM also brews approximately 100 000
hectolitres of Heineken and Amstel under licence.
The size of the beer market in Morocco is approximately 1 000 000 hectolitres
per annum with reasonable growth prospects over the next five years. The joint
venture commands a 95% market share and has a capacity to brew approximately 1.3
million hectolitres per annum.
SABMiller plc is one of the world's largest brewers, with 2002/03 lager volumes
in excess of 115 million hectolitres. It has a brewing presence in over 40
countries across four continents and a portfolio of strong brands and leading
market shares in many of the countries in which it has brewing operations.
Outside the USA, SABMiller plc is one of the largest bottlers of Coca-Cola
products in the world.
In the year ended 31 March 2003, the group generated US$770 million pre-tax
profit from a turnover of US$9,112 million. SABMiller plc is listed on the
London and Johannesburg stock exchanges.
This announcement is available on the company website. www.sabmiller.com
VP of Investor Relations Tel: +44 (0) 20 7659 0119
SABMiller plc Mob: +44 (0) 7717 428540
Head of Corporate Communications (Finance) Tel: +44 (0) 20 7659 0105
SABMiller plc Mob: +44 (0) 7799 894265
This information is provided by RNS
The company news service from the London Stock Exchange