SAB Miller partner Anadolu EFES blames Moscow brewery closure on overcapacity

By Ben BOUCKLEY contact

- Last updated on GMT

Picture Credit: Tom Godber/Flickr
Picture Credit: Tom Godber/Flickr

Related tags: Brewing

Turkish brewer Anadolu Efes will close its Moscow brewery in January 2014 blaming a 20% slide in beer sales over the past five years due to tighter regulations that have led to excess capacity.

SAB Miller took a 24% stake in the brewer in March 2012, when it signed a strategic alliance to cover Turkey, Russia, CIS, Central Asia and Middle East.

Anadolu EFES (part of EFES Beverage Group) blames average capacity utilization rates within the Russian brewing industry that have fallen to around 60% in recent years, a factor that weighed upon its decision to close its largest brewery in the country.

Only yesterday Russia market leader Carlsberg painted a gloomy picture of the market, with its beer volumes down 7% in the first three quarters of 2013, although the Danish brewer was able to maintain its full-year guidance for shareholders.

Consequently, after evaluating technical, logistical and financial factors, Anadolu EFES yesterday announced it would stop its Moscow brewing and malting operations as of January 1 2014.

“The decision was taken after the review of the current trends in the Russian beer sector,”​ the company said.

“Anadolu Efes believes that it will be able to improve its competitiveness and efficiency and ensure sustainable success in Russia taking into account both the expected synergies and the restructuring costs associated with this decision,”​ it added.

Anadolu EFES’s production capacities in Moscow amount to around 4m hectoliters of beer and 46,000 tons of malt, which are around 15% and 26% of total annual brewing and malt production capacities of its local Russian operations.

The brewer said it would reallocate Moscow beer volumes to other sites run by its subsidiary (EFES Breweries International).

What Anadolu EFES refers to as a “staff reduction plan”​ (and the rest of us job cuts) is still under final consideration.

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