Carlsberg to Brew Beer on the Roof of the World
[WTN-L World Tibet Network News. Published by The Canada Tibet Committee. Issue ID: 2004/02/10; February 10, 2004.]
Carlsberg and the Danish Industrialization Fund for Developing Countries (IFU) acquire 50 per cent of the share capital of Lhasa Brewery. The acquisition makes Carlsberg the market leader in Tibet's fast growing beer market. Lhasa Brewery is free from debt and a net result of DKK 30 million and a turnover of approx. DKK 120 million in 2003; makes it is one of the most profitable breweries in the region.
The current owner of the brewery, Tibet Galaxy Science & Technology Development Co. Ltd. will keep the remaining 50% of the shares. The parties have agreed not to disclose the purchase price and the acquisition is furthermore subject to approval by authorities.
Lhasa is the capital of Tibet and one of the highest located cities in the world at 3,760 metres above sea level. Lhasa Brewery was established in 1988 and is the only brewery in Tibet and the absolute market leader with a market share of 45%.
Following the completion of the acquisition, Carlsberg will implement its own high standards of operation including an ongoing training of the approx. 250 employees. Furthermore, there are plans to increase investments in distribution and marketing among other things to strengthen the awareness and distribution of the Carlsberg brand.
The total Tibetan beer market is estimated to be approx. 730,000 hl in 2003 and the annual per capita consumption is 18.5 litres. The beer consumption increases annu-ally by about 8%. The potential for further increase is strong due to continuous eco-nomic growth and increasing urbanisation among the young generation. In order for Lhasa Brewery to meet future requirements in a growth market and to increase the market share, the brewery's capacity is currently being expanded to 1.5 million hl beer.
The acquisition is a natural part of Carlsberg's strategy to acquire breweries with a strong market position in emerging markets especially in Asia and Eastern Europe. The acquisition is the first major Danish investment in Tibet and is at the same time in line with IFU's objective to enter into projects which can encourage the economic and subsequent social development of regions with a great potential.
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