A shareholders' agreement which is the base for a future co-operation between the major shareholder of the Korean Hite Brewery - the Park family - and Carlsberg has been signed, thus securing the future control of the Hite Brewery.
The Carlsberg investment in the Hite Brewery will make it the second biggest holder of voting shares by the end of 1999. The transaction is subject to normal acceptance by the relevant authorities.
The initial Carlsberg investment is approximately US$ 50 million which at the completion of the transaction provides it with a mix of voting shares, preference shares and convertible bonds. At maturity Carlsberg will hold 15-20% of the issued share capital.
Today, the Hite is the biggest brewery in Korea with a market share of approximately 50%, based on three hyper modern breweries of which two have been completed within the latest three years. The present production at Hite amounts to approximately 7 million hl p.a.
The Carlsberg investment in the Hite Brewery cements the long-standing relationship between the brewery's shareholders and the Danish brewery which has made it possible to sell locally produced Carlsberg beer in the Korean market for almost 15 years.
Carlsberg's investment in Korea adds to the strength of Carlsberg owned and associated breweries in Asia, where Carlsberg with this latest investment is technically and com-mercially involved in the production and sales of approximately 15 million hl of quality beer and thus by far the biggest international brewer in Asia.
Carlsberg has brewery interests and produces its beers in Nepal, Sri Lanka, Malaysia, Thailand, China, Japan, the Philippines, Indonesia, Vietnam and now Korea.
Michael C. Iuul, Managing Director of Carlsberg International, has the following comments: "Carlsberg's investment in South Korea - among the top 20 beer markets in the world - is very much in line with our strategy for strengthening our position in Asia in key beer markets. The Hite Brewery is the market leader in this important market, and it has consistently grown its market share over the last five years. The unique opportunity, and our decision to invest in the successful Hite Brewery is very much a result of the good relationship we have had with the founding family and controlling shareholder of the Hite Brewery in Korea for almost 15 years".