Sabmiller South African Breweries Post Apartheid Expansion and Financial Performance Term Paper

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SABMiller (South African Breweries) post-Apartheid expansion and financial performance

SAB Miller is by far the largest brewery in South Africa and one of the largest brewers in the world. Its presence is felt within 4 continents, with leading market shares in many of the countries it operates in. It is one of the largest bottlers of Coca-Cola outside the U.S.A. AS of 1999, SAB Miller has been listed on the London Stock Exchange, a testimony of its economic strength.

Investments

1990 saw, besides a new era of racial harmony, with the abolition of Apartheid, a new era from SAB Miller. A massive brewery investment programme was started at Alrode, Prospecton and Newlands. For the first time, domestic beer volumes exceeded 20 million hectoliters per year.

In 1992, SAB investments suffered a new push forward with the acquisition of control at Plate Glass Group, a leading manufacturer and distributor of glass products. In 1993, Hungary's top producer, Dreher, was acquired and this marked a beginning of acquisitions for SAB in Central and Eastern Europe.

In 1994, the first fully democratic elections taken place in South Africa sees a government of national unity. SAB expands its business into Tanzania and China. In the former, a joint venture with the government is formed, while in China, joint control within the second largest brewery of the country is negotiated with China Resources.

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In 1995, SAB Miller enters the Polish market with the acquisition of LECH Brewery and further expands in Eastern Europe, in Romania. It is here that SAB acquires the Vultural, Ursus and Pitber breweries. In 1996, SAB Miller invests in Slovakia, achieving a majority interest in Pivovar Saris, and in Russia, with Kaluga Brewery, some 112 miles from Moscow.

The period from 2000 to 2003 saw SAB Miller entering several other foreign markets, with serious direct investments. In 2000, the Indian market was penetrated with the purchase of Narang Breweries and in 2001, the Central American market, with Cervecer'a Hondurena in Honduras. Finally, 2003 saw the first significant SAB investment in Western Italy through Birra Peroni of Italy. Probably the most important investment during this period was the acquisition of Miller Brewing Company, 2nd largest in the United States by volume. As such, SAB Miller became the second largest brewer in the world.

Globalization

One of the main goals of SAB Miller, as exposed on their Web site is to "achieve profitable growth as a leading player in the global beer market." Perhaps this one statement is enough to give us an opinion about SAB's globalization and worldwide expansion plans. The company operates in North and Central America, in Africa, Asia and Europe. The largest turnover in 2003 was obtained from the 9.....

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