Lion Retires XXXX in the UK

By Ian Neubauer

Lion Nathan has announced it will retire XXXX from the UK market when its current licensing agreement with AB-InBev expires at the end of this month.

Lion Nathan corporate spokesperson James Tait attributed the development to the economic downturn in the UK and dwindling returns that have hampered AB-InBev’s ability to successfully market the brand.

“The mainstream lager market in the UK is subject to challenging market conditions and the profit pool available to Inbev UK and Lion Nathan was insufficient to justify continued distribution of the brand,” he said.

“In an increasingly globalised world, we have taken the view that maintaining varied brand positioning in different markets is not in the best interests of the XXXX brand in the longer term.”

Lion will replace XXXX in the UK with Steinlager Pure, a premium-priced New Zealand brew that is expected to attract higher margins

“Our strategy in international markets is to brew select premium brands for export and work with distributors in chosen international markets,” Tait said. “Brewing for export allows Lion Nathan to capture both the production and brand owner margins.

Lion Nathan shares were trading at $11.49 at midday today (Jun 10) – the same price the shares were trading at seven days ago.

[Wed 10/06/2009 03:05:04]