Coca-Cola Amatil to re-enter beer market

Coca-Cola Amatil (CCA) predicts it could cater to up to 15% of the premium beer market in Australia through a brewing joint venture with Casella Wines. Casella Wines is the maker of the Yellowtail wine brand and started brewing its own boutique beer brand called Arvo in June this year.

CCA said on Wednesday it would carry through with its intention to re-enter the Australian beer market after December 2013 via the Australian Beer Company, a joint venture with Casella. CCA would lend up to $46 million to the Australian Beer Company to put towards the acquisition and expansion of a state-of-the-art brewery operated by Casella Wines at Griffith in NSW. The joint venture would make premium beer and develop brands to be sold and distributed through CCA’s existing network.

“This new agreement with Casella will give CCA the opportunity to access a world-class, low-cost brewery, which will enable us to re-enter the premium beer market in Australia after 16 December 2013,” CCA Group Managing Director Terry Davis said.

Casella Wines Managing Director John Casella said Casella wanted to diversify and that a brewing operation could share much of the infrastructure attached to a winery. Casella envisaged that the Australian Beer Company would make overseas beer brands under licence and develop its own brands. He said Australia had barley, hops and water to match anywhere else in the world and there was no reason why Australia should not make more premium beer locally.