Czech brewer bought by Carling giant

Staropramen, the second-biggest brewery in the Czech Republic, has been bought by American-Canadian giant Molson Coors for $3.54 billion/2.65 billion euros. Molson Coors, which brews Britain’s biggest beer brand, Carling, will also acquire breweries and brands in Bulgaria, Bosnia, Croatia, Serbia, Hungary, Montenegro and Slovakia as part of the deal.

The breweries have been bought from StarBev, formerly known as CVC, which acquired the breweries in Central and Eastern Europe in 2009. Staropramen – which means Old Spring – was part of Prague Breweries under the old communist regime. When communism ended, Prague Breweries were bought by Bass, the biggest brewing group in Britain, which eventually sold them to the Stella Artois group, Inbev. When Inbev merged with Anheuser-Busch of the United States to become AB InBev, it slimmed down its operations in Central Europe and sold a parcel of nine breweries to CVC.

StarBev employs 4,100 people and produces some 13.3 million hectolitres annually. It holds a top three market share in each of its markets. The takeover by Molson Coors is subject to European Union scrutiny and is expected to be finalised later in 2012.

“The acquisition of StarBev fits squarely into Molson Coors’ strategy to increase our portfolio of premium brands and deepen our reach into growth markets around the world,” says Peter Swinburn, president and chief executive of Molson Coors. “The Central and Eastern European beer market is attractive, with strong historical trends and upside potential as the region returns to its pre-economic-crisis growth rates. StarBev, as a market leader in the CEE region, provides Molson Coors with a great platform for growth and an excellent foundation from which to extend our key brands, such as Carling, into Central and Eastern Europe. Staropramen, StarBev’s international flagship brand, will also enhance our portfolio in some of our current and planned markets.”

Most of the Czech Republic’s acclaimed brewers of traditional lagers are now in the hands of global brewers. Pilsner Urquell, the original golden beer from Pilsen, and the neighbouring Gambrinus brewery, are now owned by SABMiller. Budweiser Budvar remains independent and still owned by the government, but there is continuing turmoil over the future ownership of the company. The current Czech government plans to turn Budvar into a joint stock company as the first step towards privatisation.

While AB InBev has withdrawn from several Eastern European markets, it would be first in line to buy Budvar and end the century-long battle over the trademark dispute between the two Budweiser brands.