AB InBev to build new brewery in fast-growing Mozambique

JOHANNESBURG (Reuters) - Anheuser-Busch InBev, the world’s biggest brewer, will start building a more than 2 million hectoliter a year brewery in Mozambique in the second half of next year, the company’s Africa head said on Tuesday.

FILE PHOTO: A woman serves a one litre bottle of AB Inbev's Carling Balck Label beer at a bar in Cape Town, South Africa, May 11, 2018. REUTERS/Mike Hutchings/File Photo

The Mozambique investment will look to fend off competition from rival Heineken, which is the middle of building a $100 million brewery in the southern African country.

It will also help AB InBev keep pace with demand in a market that saw growth over more than 20 percent in the first half of this year, Ricardo Tadeu, the company’s Africa zone president told journalists in Johannesburg.

“It’s a reflection of how much we have been adding on the continent, constantly aiming for growth and putting the money where our mouth is,” he said.

Tadeu said the company was not ready to disclose the size of its investment in the new facility, but added that the land acquired for the project would allow for further expansion of brewing capacity in the future.

AB InBev already brews the 2M and Laurentina brands in Mozambique in another brewery.

Substantial gas reserves discovered off Mozambique’s Indian Ocean coastline more than a decade ago were expected to jumpstart its economy. But progress in setting up the infrastructure to tap them has been glacial, slowing the pace of investment in many sectors.

AB InBev paid roughly $100 billion to buy rival SABMiller in 2016, giving it a substantial presence on the continent of more than a billion people.

It has operations in 15 markets mainly in southern and east Africa, but also Ghana and Nigeria in west Africa.

It announced plans in March to invest $100 million in a new 1 million hectoliter per year brewery in Tanzania, where beer volumes jumped by a fifth last year and its local unit Tanzania Breweries already runs four facilities.

“We’re very excited about Africa because we have experience in Latin America and Asia. Some people look at Africa and see a lot of volatility, uncertainty. We see opportunity,” said AB InBev CEO Carlos Brito, who was visiting South Africa.

“For us, Africa is definitely the place to be.”

editing by Tiisetso Motsoeneng and David Evans