Heineken and Efes united – under Heineken’s roof

In October 2008 United Serbian Breweries announced that, following the merger of Heineken and Efes in Serbia earlier this year, it will operate the combined business in Serbia under one management team and one name – United Serbian Breweries. In order to become one of the leading players in the Serbian market, United Serbian Breweries has also announced the closure of the former Efes brewery in Pancevo and the decision to scale back production at its breweries in Zajecar and Novi Sad from a total capacity of 2.1 million hl to 1.5 million hl.

These measures are necessary in order for United Serbian Breweries to increase its competitiveness and produce sustainable financial results. United Serbian Breweries is 72 percent owned by Heineken and 28 percent by Efes Breweries International.

In-depth analysis of the company’s assets revealed, says Heineken, that the combined production capacities of United Serbian Breweries’ three breweries largely exceed its needs. Also, technical conditions in Pancevo brewery would not make further investment in this facility economically viable. Hence the Pancevo brewery will be closed. Thirty employees from Efes Pancevo brewery will be transferred to other positions within the company.

The company has decided to concentrate future investments in Zajecar and Novi Sad breweries, and plans to invest approximately EUR 50 million over the next three years.

United Serbian Breweries plans to reduce the overall size of its workforce by approximately 200 employees. The proposed severance packages will be 30 percent higher than usually paid.

Investment plans for Novi Sad and Zajecar will contribute to the implementation of United Serbian Breweries’ international quality standards.

InBev has a 51 percent share of the 6 million hl Serbian beer market. Carlsberg claims to be the number two brewer in Serbia with a market share of 23 percent. In September 2008 Heineken told the media that its market share in Serbia was 9 percent. Efes last reported a market share of 10 percent in January 2008.