McCallum’s targets Asia-Pacific region

By Chittaranjan de Silva

Sri Lanka’s McCallum Brewing Company (MBC), said its latest product, the White Beer, is the only wheat beer brewed in Asia.

MBC, brewers of "3 coins" beer in Sri Lanka, announced on Thursday that it has entered into a joint venture with Riva N.V. of Dentergem, Belgium, securing the rights to jointly brand, produce and market a speciality white beer in the world market.

Officials of McCallum Brewery said they have decided to sell the new jointly branded wheat beer "3 Coins Riva" in the Asia-Pacific countries including Thailand, Singapore, Japan, Australia and New Zealand.

The jointly branded product would be distributed and marketed by a new joint venture company, which would be registered with the BoI. McCallum and Riva will hold 50% of the equity in this company, Chairman, MBC, Chandana Ukwatte said. "This is the first instance that an international brewer is jointly branding with a local brewer," Ukwatte said.

He further said that joint branding was "more than manufacturing under licence." Joint branding provides a new opportunity for McCallum Brewery to establish itself as a credible base for the manufacture of high value speciality products.

MBC’s CEO, Lasath Suriyaperuma explained that the company had invested heavily in new technology and was not reaping the expected results, "because the beer market in Sri Lanka was not growing."

According to Ukwatte, taxes levied on the beer industry by the government, has caused a decline in beer drinking.

Suriyapperuma said it was not profitable to concentrate on competing in the "mass market," because the market was down.

So, McCallums decided to go for a value added speciality product in white beer which would mainly target the foreign markets, he said. He further said that white beer was produced by a German engineer employed at the McCallum Brewery.

Managing Director, Riva Brewery, Annick De Splenter said that her company was searching for partners in the South Asian region, when McCallum Brewery’s was introduced by the Belgian Ambassador, Guy Trouveroy.

While commending the McCallum Brewery’s beer products, she said Riva’s officials were pleasantly surprised the local brewers capabilities.

She pointed out that Sri Lankan company would be able to make a name for itself through the new beer products. Ms. De Splenter also said that Riva would be able to market white beer to the South Asian region through MBL, which was earlier difficult since tax regimes existing in different countries made it difficult to penetrate the market.

On the other hand, 3 Coins Riva brand would give the Sri Lankan brewery competitive advantage in the market, she added.

While beer is completely a European product and it is not brewed in the tropics. But a market exits in countries such as Australia, Singapore and Japan, she said.

The 3 Coins Riva white beer will be available in the local market from March 8th onwards and a 375ml beer bottle would cost Rs. 65.00, MBL officials said.