German brewery is ready for mergers, UK analysts say in report - The Beer Market in Germany, - report by WestLB Panmure - Brief Article

Modern Brewery Age, August 27, 2001

A recently released report from the British research company WestLB Panmure posits that the German beer market will be the next to fall under the sights of the big brewing consolidators. At this point, the fragmented UK industry has been consolidated, but German industry share remains divided among numerous mid-sized competitors.

"Despite being the world's third largest beer market, local brewers must either consolidate or die," the report said.

The report, entitled "The Beer Market in Germany" said that Germany is an attractive market for a number of reasons. It is a stable country, with relatively plentiful and cheap assets in the brewery sector and beer demand remains fairly strong. The country is also a good base to build export from, due to the reputation of German beer.

However, there are drawbacks. The report calls the German beer market inclement" at the moment, with declining value for established brewers. "The international brewers most likely to succeed in Germany are Anheuser, Heineken and Interbrew," the report reads. "It's a rich brewers game with the odds firmly in favor of those with scale and deep pockets."

Prime acquisition targets identified in the report included Binding, Brau & Brunnen, Holsten, Kromacher, Veltins and Warsteiner.