American company inks USD 10 mn tech pact with microbrewery firm

American Brew Works, based in Dallas, USA, has entered into an agreement with Prodeb Brewery Belgium Pvt Ltd under which the latter will licence technology to the American company for manufacturing microbrewery equipment.
American company inks USD 10 mn tech pact with microbrewery firm

Chennai

Prodeb is the largest microbrewery equipment manufacturer in the world and has a plant in Chennai. Now, American Brew Works will invest $10 million to set up facilities that will produce microbrewery plants, using Prodeb’s know-how. Beer is globally the third most popular drink, after water and tea. Beer sales have been growing globally at a rate of 2.4 per cent a year and the global beer market is expected to reach $636 billion by 2020. The five biggest markets for beer are China, US, Russia, Germany and Brazil.

India too is a large beer-consuming country. It has always been among the first five biggest markets in the Asia-Pacific region. Interestingly, a microbrewery culture has been growing in India, where beer is brewed in the pubs for then-and-there consumption. There are around 200 microbreweries in India – half of them in Bengaluru alone – and they produce 6 million litres of beer a year, worth Rs 300 crore (Rs 3 billion). The best part of this sub-segment is that it has been growing at a rate of 30 per cent in the last three years; this annual rate of growth is expected to accelerate to 45 per cent in the coming years.

A third of the Indians are millennials. By nature, they are fun-seekers and are always on the lookout for new experiences. Craft beer produced by microbreweries has caught their fancy and they are the main drivers of the Indian market.

Now, more and more states are allowing microbreweries to be set up in consumption centres like pubs. These states include Maharashtra, Karnataka, West Bengal, Punjab, Haryana, Assam, AP, Telangana and Goa. Soon, Kerala and Puducherry are also expected to join their ranks. The craft beer industry in India is poised for tremendous growth, notes Sushil Eashwaran, JMD, Prodeb.

It is this growing market that the American Brew Works aims to address. According to Kavunder, CEO, American Brew Works, the company had been looking for a good partner for some time and has now zeroed in on Prodeb. In India, 70 per cent of the microbreweries and 85 per cent of the beer produced by them are of Prodeb’s machinery, says Sushil Eashwaran.

Armed with Prodeb’s technology, American Brew Works will invest in setting up a plant, in two phases. When complete, the plant will be the world’s largest microbrewery equipment manufacturer in the world. While the growing Indian market will remain in American Brew Works’ cross-hairs, the company will also address the global market for microbreweries too, Kavunder says.

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