Carlsberg invests in North West China

Related tags People's republic of china

Danish brewer Carlsberg has acquired a 34.5 per cent stake in Wusu
Brewery, located in the Xinjiang Autonomus region. The move
represents Carlsberg's ambitions to increase its presence in the
less developed Western provinces.

Carlsberg​ made the agreement with Ongo Investment, a Singapore registered company, and various minority shareholders to acquire the stake and refused to disclose the value of the investment.

The brewery will in the future be operated in a joint venture between Carlsberg and the Blue Sword Group, a local company in the region.

Wusu Brewery has a capacity of approximately 2.5 million hl and a 60 per cent market share in the region (equivalent to a total sales volume of 1.5 million hl beer).

Annual per capita consumption of beer in the region is around 14 litres, which is below the China national average of 20 litres per year, giving significant potential for growth. This gives the brewer reason to believe that the company will hold considerable market potential in the future.

"The acquisition of Wusu Brewery is a further step in fulfilling Carlsberg's strategy to establish a strong position in the western Chinese provinces,"​ said Jesper Madsen, Carlsberg's senior vice president for Asia. He went onto point out the company is now the only international brewer to have a major presence in the Western provinces, a region that has a population of 100 million people.

Like all the other international brewers, Carlsberg has been investing heavily in China of late. The investments include joint ventures with market leaders in Gansu Province and in Tibet and the company is planning to build a greenfield brewery in Qinghai province. It also bought the leading brewery in the Yunnan Province last year.

Related topics Business Beverages China East Asia

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