The company said that this means there are 'significant inefficiencies' and it is economically unviable to modernise the brewery.
Production at Caledonian Brewery, which has been brewing for more than 150 years, had steadily declined over the last ten years as the brewer had evolved its portfolio, Heineken UK said.
The 30 staff at the brewery and their trade union/colleague representatives will be consulted on the proposals. Caledonian Brewery will continue to operate during the consultation process.
Matt Callan, supply chain director for Heineken UK said: “We’ve not taken this decision lightly. We’re acutely aware of what the brewery represents in Edinburgh, and its role in the history and heritage of brewing in Scotland – this is something we’re incredibly proud of. Our primary focus is the 30 colleagues based there and we’ll now enter into a period of consultation.
“The sad fact is, its Victorian infrastructure means significant inefficiencies and costs, particularly as it is operating below capacity. To modernise the brewery, and to meet our own sustainability commitments, would require considerable ongoing investment, which would make operating the brewery economically unviable.”
Caledonian brands will continue to be brewed in Scotland as there is an agreement in principle with Greene King to continue brewing, including brands Deuchars and Maltsmiths, at its Belhaven brewery in Dunbar, Scotland.
Agreement in principle
Callan added: “We’re also aware that the beers produced at Caledonian Brewery are enjoyed by many people across Edinburgh, Scotland and beyond. That’s why we’re working hard to make sure the Caledonian brands will continue to be produced in Scotland if the proposed closure goes ahead. We’ve an agreement in principle to licence the brands to Greene King who will brew Deuchars, Coast to Coast and Maltsmiths IPA and Lager at its Belhaven brewery in Dunbar.”
Matt Starbuck, Greene King brewing & brands managing director, said: “These brands are long loved in both Scotland and beyond and we are proud to be able to continue to brew them so they can be enjoyed by consumers and customers alike.”
“This agreement underlines our commitment to Belhaven Brewery as Scotland’s oldest working brewery, and boosts our portfolio of already award-winning beers.”
Heineken recently revealed that the war in Ukraine has brought additional uncertainty to the global economic outlook and commodity markets.