LONDON (Brand Republic) – Danish brewer Carlsberg has admitted some defeat in the Chinese market and sold a majority stake in a its Shanghai brewery to Tsingtao Brewery, the Chinese market leader, for $18.5m.
The sale of 75% of Carlsberg Brewery Shanghai is the latest sign that foreign companies are having trouble breaking into the Chinese market -– although Carlsberg said it would “not give up” there.
Carlsberg invested around $30m in the state-of-the-art plant in 1998, but has been in China since 1991. The company refused to confirm the total amount it had invested there or how much it had lost.
Analysts said global brewers had misunderstood Chinese consumers, who were unwilling to spend their hard-earned cash on premium foreign brands.
Bass invested heavily in China, convinced its £1.3bn consumers would drink its branded lager, but started negotiating an exit from the market in March after it realised people were favouring cheaper local beers.