The largest purely Czech private brewing group has disclosed its shareholder structure. It has become the fifth largest beer producer in the Czech Republic.
It is something of a revolution in the Czech beer sector. The company K Brewery, which is in the hands of Martin Burda, Grzegorz Hóta, Eva Kropová and Zdeněk Radil, according to HN information, has become the fifth largest beer producer in the Czech Republic in terms of output, as its production has approached that of Budějovický Budvar. The recent taking control of positions in Lobkowiczký pivovar and in Pivovar Rychtář, a Hlinsko-based brewery, also contributed to the rise.
The four investors whose names were disclosed by board chairman Zdeněk Radil last weekend, only needed approximately two years of active involvement in the beer industry to achieve that. The duo Burda – Hóta that control a majority stake in K Brewery have spent dozens to hundreds of millions of crowns on shares in six plus two new regional breweries.
“We regard investment in this sector as advantageous in the long run. We have nothing to hide,” Radil said on the announcement of the shareholder structure in K Brewery. For a few months, there have been speculations regarding the stake held by Martin Burda who also is the owner of the spa company Lázně Luhačovice, for example. He is 34, and entrepreneur Grzegorz Hóta from Třinec is even three years younger. Hóta is the owner of the Třinec-based engineering company Tritreg and of many other businesses, but also an ally of the controversial Czech financier Pavel Tykač. According to media reports, Tykač and Hóta teamed up last year in the fierce battle for control over a stake in the brown-coal mine Sokolovská uhelná.
At present, K Brewery controls the breweries Janáček (based in Uherský Brod), Platan (Protivín), Ježek (Jihlava), and is heading for Lobkowiczký pivovar and Pivovar Rychtář. Together with the fund LIF, it has shares in Svijany, Rohozec and Klášter. Their combined output exceeded 1.1 million hectolitres last year, according to data from the Czech Beer and Malt Association.
The aggregate annual production of all Czech breweries amounts to nearly 20 million hectolitres, of which 16 million hectolitres comes from the giants Plzeňský Prazdroj and Pivovary Staropramen, controlled by Heineken, and from Budějovický Budvar.
K Brewery is therefore now in fifth place on the market, replacing the until-now-largest Czech private group PMS Přerov, comprising the breweries Zubr, Litovel and Holba. PMS chief executive Petr Fridrich said he did not regard the “game of numbers” as having any information value: “Nobody knows what the intentions of the people in K Brewery are. And their breweries still act as independent companies.” Since K Brewery started to buy stakes in Czech regional breweries two years ago, there have been speculations that it carries out the purchases on behalf of some of the giant beer makers. In its latest acquisitions, Lobkowiczký pivovar and Pivovar Rychtář, the company has acted through allied firms like Aetheon Capital CE.
“We have agreed to incorporate both breweries into K Brewery structure soon. Just to reiterate, we do not act on behalf of anyone. We regard the brewing business as promising and want to develop it,” Radil said.
The people in K Brewery say their objective it to resume or maintain the tradition of brewing genuine Czech beer and to reinforce its position in different regions accross the country. They say a similar strategy should be applied in the case of Lobkowiczký pivovar, now an export-oriented brewery that was controlled by the Germans until recently.
“We will keep our export markets. But we will pay more attention to marketing, gastronomy and distribution on the domestic market,” the brewery’s director Petr Peniaštek said. Lobkowiczký pivovar, making profit for a long time with a turnover of around CZK 130 million, and Pivovar Rychtář are the seventh and eighth acquisitions of the group of financiers.
K Brewery’s human resources policy suggests an aggressive style as well. For its marketing and distribution positions, the company has poached some twenty managers and employees from Plzeňský Prazdroj, the market leader.
