No.9004   2005. 1. 19

Suntory to Acquire Shanghai Donghai Brewery
- Holding a Stake to Consolidate the Position as Shanghai's Top Brand -

Suntory Ltd. has made a deal through Suntory (China) Holding Co., Ltd. (Location: Shanghai, General Manager: Yoshikazu Okada, Investment ratio: Suntory 100%) to acquire a 74% stake in Shanghai Donghai Brewery Co., Ltd. (Location: Shanghai, Managing Director: Sun Feng Ying) and to hold a management right.

The beer market in China has grown remarkably to become the world's largest both in production and consumption. Especially in Shanghai area, the market has been expanded at a constant rate and is expected to grow further.

Founded in 1993, Shanghai Donghai Brewery sold approximately 110,000 kl in 2004 to rank in the second place in sales. Their core products include “Donghai”, “Jinse Maitian”, and “Yingshi”, popular among people in Shanghai.

This acquisition has been implemented to consolidate Suntory's position as the leading brewer in Shanghai beer market. Combined with the second most selling company, Shanghai Donghai Brewery, the market share of Suntory group is expected to exceed 50% in the region.

•Suntory's beer business in China
In 1984, Suntory established China Jiangsu Suntory Foods Co., Ltd. in Lianyungang, Jiangsu Province, as the first foreign company to form a joint venture brewer, putting their feet on the beer business in China. Utilizing its experiences acquired through its Jiangsu beer business, the company entered the fast growing beer market in Shanghai in 1995 and soon to gain the number one position in 1999.Ever since then Suntory Shanghai has maintained a steady growth through a variety of activities including production and sales of the first draft beer in the region, and now holds over a 40% share in Shanghai area.

•Company Profile for “Shanghai Donghai Brewery Co., Ltd.”
▼Company name: Shanghai Donghai Brewery Co., Ltd.
▼Location: Jinshan District, Shanghai
▼Capital: USD 4.83 million (JPY 497 million; USD1 = JPY103)
▼Established: 1993
▼Number of employees: 420
▼Business: Beer brewing and distribution
▼Main brands: “Donghai”, “Jinse Maitian”, “Yingshi” etc.
▼Annual production capacity: 200,000 kl
▼Sales: JPY 2.1 billion (in 2004, estimate) *based on RMB 1 = JPY 13