Heineken Takes Amstel Away From SABMiller

From SABMiller Website... www.sabreweries.com

Message to the SAB Community

Amstel Lager

The south African Breweries Limited (SAB) will no longer be brewing, marketing or distributing Amstel Lager in South Africa. the licence, held by Heineken, has been terminated by them with immediate effect. Heineken have invoked a term of the agreement which refers to a change in the shareholding of SABMiller, and is based on our purchase of Bavaria in South America last year. An arbitration process found that SABMiller’s transaction in South America in 2005 constituted a change in control of the group and consequently could be regarded, in the reasonable opinion of Heineken, to be contrary to the interests of the Heineken Group, which provided it with the right to termination.

SAB has been brewing and distributing this brand under licence in South Africa for 40 years and has built the brand up from its mainstream positioning worldwide to becoming a premium product in South Africa. As one of our country’s most notable success stories, SAB has grown into sABMiller plc, now the second largest brewer in the world. Clearly, our global strategy has worked rather too well and Heineken did not expect that a brewer from a small country could expand and succeed the way we have. Heineken has said that their objective was to restrict our south African and international success, but we find it really difficult to believe that SABMiller’s having a new 15% shareholder as a result of the Bavaria transaction in south America - on the other side of the world – poses any threat whatsoever to Heineken’s interests in south Africa.

We certainly did not want to give up this brand. we have built it from scratch in south Africa and have put more than 40 years of product development behind its success. we have put together a brief communication to all in the SAB family, to answer some of the questions you may have. SAB employees will receive a full briefing from the company, while all our customers will receive additional information from our trade representatives. while we deeply regret any inconvenience or stockouts of this brand, we can assure all customers and consumers that SAB will continue to provide a full and broad portfolio of brands across the premium spectrum.

Our consumers and customers are our first priority and we will draw upon our significant global premium portfolio to make sure that we continue to provide consumers with a comprehensive choice of differentiated and superior products. SAB has a capacity and capability that is much admired throughout the world and looking ahead, our challenge is to rise to the task and show that we’re more than up to it.

Tony van Kralingen
Managing Director