Sapporo Optimizing North American Production to Enable Growth in Canada

Company actively seeking buyer for its Dartmouth facility

GUELPH, ON, March 6, 2013 /CNW/ - Sapporo International, the parent company of Sleeman Breweries Ltd., announced today its intent to sell its Dartmouth, N.S. brewing facility.  As part of the strategy to meet growing demand for Sleeman and Sapporo in Canada and the U.S. in the short-term while also enhancing overall productivity across its North American operations, Sapporo International will also shift 200,000 hectolitres (hL) of Sapporo products, bound for export to the U.S., from its Guelph, ON facility to a third party brewing partner in the United States effective June 2013.

"Sapporo has been increasing its North American market share in a category that is experiencing only modest growth. In order to consolidate and maximize this momentum, we must make some immediate and crucial changes to our North American brewing strategy to improve productivity across our entire operation," says Shige Yokoi, President and CEO, Sleeman Breweries Ltd.

"The impetus behind our intent to sell the Dartmouth facility, which produces less than two per cent of annual volume, is to establish the long-term competitive resilience we need in an aggressive market by taking advantage of the economies of scale our North American operations offer," Yokoi adds.

To this end, Sleeman has already engaged some prospective buyers who have indicated a desire to keep the facility as a brewery, including keeping some or all of the 32 affected employees.  However, should an appropriate buyer not be identified by July 2013, the company will make the difficult decision to close the facility.

"Please let me emphasize my appreciation for the hard work and contributions our employees have put into Sleeman at every level," says Yokoi. "I know this decision creates a lot of concern and anxiety among our 32 Dartmouth staff in particular. By actively advancing a sale now, we very much hope to secure the jobs and viability of this brewery. But in the long-term interests of our North American operations, we felt we needed to achieve some efficiencies of scale right away to stay competitive against our much larger continental and global rivals."

Sleeman Breweries currently produces more than 1.8 million hL of volume a year at facilities across Canada, including 27,000 hL at Dartmouth. By shifting 200,000 hl of Sapporo (which has been exported to the U.S. since 2002) from Guelph to the U.S., including the Sapporo kegs, the Sapporo Premium 20.3oz bottle, 16oz bottle, 12oz bottle and 12oz can and Sapporo Premium Light 12oz bottle, the company will be able to deliver on consumer demand in a more productive manner by the end of Q2 2013. Guelph will continue to produce all Sapporo products for Canada and the Premium 22oz can and the Sapporo Reserve 22oz can and 12oz bottle for both the U.S. and Canadian markets.

"We have to act now in order to capitalize on our competitive momentum and the efficiencies and production benefits our integrated North American operations offer will help us advance this goal, including the long-term productivity of our facilities in Chambly, Quebec, Guelph, Ontario and Vernon, British Columbia," says Yokoi.

About Sleeman Breweries Limited
Sleeman Breweries Ltd. is the third largest brewing company nation-wide. The company has supplemented its core Sleeman brands, which are available in every province, with a family of exceptional regional brands. These include Okanagan Spring in British Columbia and Unibroue in Quebec. Sleeman entered the rapidly growing value price category in 1999 by acquiring the Stroh portfolio brands in Canada, including Old Milwaukee and Pabst Blue Ribbon. In 2006, Sleeman Breweries Limited was acquired by Sapporo Holdings Limited of Japan. The company markets and/or distributes world class imported products such as Guinness, Sol, Dos Equis and Tecate and is supported by 1,000 employees.

About Sapporo Holdings Limited
Sapporo Holdings Limited is a Japanese holding company with an enterprise value of C$4.0 billion that is active in five business segments and includes Sapporo International as its overseas business segment. Its Alcohol segment is engaged in the manufacture and sale of beer, RTD, sparkling liquor, wine, shochu, liquor and others. The company manufactures alcohol products including Sapporo Draft Beer, Yebisu Beer and Mugi & Hop. The company also distributes Yellow Tail and Beringer in Japan. The Food & Beverage segment manufactures and sells beverages, such as tea, mineral water, coffee, carbonated drinks, fruit juice, health drinks, sports drinks and others as well as foods, such as, soup, lemon seasoning and others. It distributes Ocean Spray Cranberry in Japan. Its Restaurant segment is involved in the operation of beer parlors and restaurants under the store name Ginza Lion. The Real Estate segment is engaged in the operation and management of complex facilities that contains offices, housing, restaurants, and commercial and cultural facilities under the name Yebisu Garden Place, in addition to commercial and amusement complex facilities.


For further information:

Stéphane Duval, Vice President, Marketing, Sleeman Breweries Ltd. / 514-702-1730

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