It’s Miller Time for Grolsch

LONDON London-based beer giant SABMiller on Monday announced its offer of $1.2 billion for Dutch brewer Grolsch, which is still sold in bottles with a ceramic stopper.

SABMiller, whose brands include Miller Lite in the United States, is betting beer drinkers will be willing to pay more for the Dutch beer, brewed in Enschede, Netherlands. The company is following in the consolidation trend of other big beer groups, including Amsterdam-based Heineken, which added diversity in its portfolio by acquiring local or niche brands and applying its marketing and distribution clout to serve the brew to a wider audience. “Grolsch fills an important gap in our portfolio, which lacks northern European brands,” SABMiller Marketing Director Nick Fell told analysts during a conference call.

Although Grolsch has wide global name recognition, 75 percent of its sales are still in the Netherlands, meaning there is a lot of potential for the brand in the international market. Grolsch shares with Heineken a certain Dutch flavor not found, for instance, in American beers. SABMiller will try to market Grolsch in places like Colombia where upwardly mobile beer drinkers want a beverage that conveys status but doesn’t challenge their taste buds too much. “We see significant potential across Africa and Latin America, where the premium market is still in its infancy,” SABMiller’s chief financial officer, Malcolm Wyman, told analysts.