InBev Germany sells Dinkelacker brewery
In a tough market which has seen consumption decline 20 percent between 1991 and 2005, InBev has attempted to revitalise its business through the sale of breweries and the rationalisation of remaining operations. Dinkelacker-Schwabenbräu is the third brewery InBev has sold within one year.
Although InBev has yet to release its 2006 figures, it has already admitted that in the third quarter of 2006 its sales in Germany were down 1.5 percent on a year-on-year basis. Germany’s beer sales managed to increase 0.5 percent in 2006 thanks to favourable weather conditions especially during the football world championship.
InBev, which is Germany’s number two brewing group behind Radeberger Group, has looked hard at its breweries in Germany in an effort to determine which were for keeps and which were for sale. In 2005, InBev Germany called eight breweries its own. The first brewery to go at the end of 2005 was the 400 000 hl Mauritius brewery in Zwickau, Saxony. Thanks to a management buy-out 83 jobs could be saved. When soon after the news made the rounds that InBev would close the 800 000 hl Wolters brewery in Braunschweig and relocate production to the nearby Gilde brewery in Hannover, it was met with a storm of protest. After several months of negotiations, the brewery and the brand were finally sold to a group of four former InBev employees in July 2006 for the sum of EUR 8.3 million. Of the 100 or so employees, more than 65 were to keep their job.
The 1.5 million hl Dinkelacker-Schwabenbräu brewery in Stuttgart is the last brewery to date to have been sold. Although InBev’s German competitors, Radeberger and Paulaner/Heineken, are said to have shown an interest, they must have shied away from the asking price which was rumoured to be EUR 70 million. Shortly before Christmas, InBev Germany clinched a surprise deal with Dinkelacker-Schwabenbräu’s former owner, Wolfgang Dinkelacker, a Stuttgart real estate specialist, whose ancestors had founded the brewery in the 19th century. It was only in 2004 that Wolfgang Dinkelacker had lost control of the brewery when it was sold to Interbrew as part of the Löwenbräu/Spaten parcel.
No details of the financial transaction have been released.
InBev Germany maintains that Dinkelacker-Schwabenbräu is a sound business and refutes all suggestions that financial troubles had led to the sale. InBev’s spokesperson said that Dinkelacker was a healthy brand. However, InBev has constantly been re-valuing its world-wide brewing operations and their strategic fit. Apparently, the fit of one of southern Germany’s major breweries had become less obvious to InBev, which is why it was flogged off so soon after the purchase.
Dinkelacker-Schwabenbräu, which is a merger of two Stuttgart breweries, currently employs 330 people. InBev and Wolfgang Dinkelacker both insist that they would continue cooperating.
InBev Germany’s remaining breweries are in Munich (Spaten, Löwenbräu, Franziskaner), Issum (Diebels), Bremen (Beck’s), Hannover (Gilde) and Wernigerode (Hasseröder).
The Diebels brewery, which was Interbrew’s first German acquisition, was also rumoured to be on the block last year.
