Licensing trusts and D.B. to build $8m brewery

Press, Volume CXIV, Issue 33607, 8 August 1974, Page 3

Licensing trusts and D.B. to build $8m brewery

Dominion Breweries, Ltd. and seven South Island licensing trusts will combine in a venture to build and run a new brewery at Washdyke, north of Timaru. The venture will cost upwards of sßm.

This is a new development in the competitive expansion of Dominion Breweries, Ltd, and New iZealand Breweries. Ltd, Ito acquire hotels to secure their outlets. The new Timaru brewery, is due for completion by mid-1976, and will complement the output of Dominion Breweries’ other South Island brewery, at Greymouth, and eliminate the firm’s dependence on New Zealand Breweries beer for many of its outlets. The new brewery will be run by a private limited liability company, D.B. South Island Brewery, Ltd. which will be incorporated as soon as possible, according to an announcement yesterday by rhe chairman of Dominion Breweries (Sir Henry Kelliher) and the chairmen of the seven licensing trusts. The capital of the company will be subscribed 55 per cent by Dominion Breweries, and 45 per cent by the trusts on an allocation mutually agreed upon by them. Each “side” will have three directors on the board. Hornby participation The Christchurch announcement was made by Mr H. W. Bennett, chairman I of the Hornby Licensing Trust, the only “local” trust to participate. The district trusts concerned are Ashburton, Geraldine, Oamaru, iClutha, Mataura, and Invercargill. “Representatives of the trusts have said that the 'decision to undertake the joint venture has been undertaken only after the most serious consideration of both ithe economic aspects and the j public interest,” said Sir Kelliher. "The public will be aware That, on many occasions, the I trusts have given consideration 'to establishing their

..own brewery, but investiga-l , itions have shown quite con-: Tclusively that there is an insufficient gallonage in the T trust districts to make a , trust brewery an economic ( I proposition. | “The joint venture with Dominion Breweries achieves ja similar effect, in that the y trusts will participate as to J 45 per cent of the manufacturing profit of the brewery, r: as well as retaining their normal retail margins on beer ; |sales to the consumer. r. r Cash for community , “This,” said Sir Henry, j "will stimulate the flow of , cash to the various trust dis-i ; tricts for further develop-; , ment and for community pro-! , jects.” The new brewery would be jithe most modern in the Southern Hemisphere, and , would make and market D.B. packaged beer for the whole , of the South Island, and D.B.

bulk beer from North Can-1 terbury to Bluff. The West Coast, Nelson, and Marlborough would continue to be supplied with bulk beer from the Westland Brewery, Grey mouth. Apart from the obvious’ economic benefits, said Sir, Henry, the other main con-1 sideration was to satisfy the. public demand for Dominion Breweries products. For several years, great, difficulty had been found in maintaining supplies, almost exclusively through transport problems. “Invariably at peak times,! and for some years, consider-, able shortages have been experienced,” he said. “Participation in the new brewery will ensure that this problem is overcome, and patrons of hotels and taverns through-' out the South Island will] have a choice of draught ale; for the first time in many! years. • “It is my personal con vic-! tion, which is shared by the' chairmen of the licensing trusts, that the establishment of the new brewery on a i joint venture basis will make! a major contribution tp the. further development of the South Island,” said Sir, Henry. “In particular, it will pro-! mote regional growth by providing employment in South Canterbury for about 100 brewery workers, as well as | transport and administrative: staff.”

I Mr Bennett said that the trusts had believed for many, years that the growth of! their business indicated that., sooner or later, they must I become involved in the .brewing and distribution of I beer. Although Hornby was 'the largest of the local; itrusts, the eenomics were, ;such that it could never have run its own brewery "The joint venture is a' very happy solution,” tie said. Two other local trusts, those at Cheviot and Hawarden, have not participated in (the scheme — the only exIceptions in the South Island’s, nine trusts. Twenty-acre site The brewery will be built on a 20-acre site to the north of the premises of J. Wattie Canneries. Ltd, says the Timaru reporter of “The Press.” Apart from minor details, the final oite plans have been approved by the Timaru , City Council. Trade-waste disposal arrangements are said to be I satisfactory, and the brewery, I will have its own railway' I siding. The Oamaru Licensing ; Trust covers the district be- : tween the Waitaki River and Tunedin, and its chairman ifMr.J. B. Crombie) said that the joint venture meant that trusts would, all the sooner.! I be ale to pay for major com > munity projects, as well as develop trust facilities.