Mexico: AB InBev to build new 12 million hl brewery

Grupo Modelo, famous for its signature Corona beer and fully owned subsidiary of AB InBev, announced on Monday to build for 4 billion Mexican pesos ($750 million) a brand new brewery in the city of Apan in the central state of Hidalgo, Mexico.

This will be the biggest private investment in the history of the state of Hidalgo according to government officials. The brewery is expected to create 3,500 new jobs during its construction and 1,200 direct jobs during its operation.

Grupo Modelo, which already owns 7 plants in Mexico, plans to start construction of its eights plant soon with completion expected in the first quarter of 2019.

The brewery will have an initial production capacity of 12 million hectoliters (320 million gallons) with the option to double the capacity. Grupo Modelo already operates another 24 million hectoliter brewery in the state of Zacatecas, Mexico, which is considered to be one of the largest breweries in the world.

Largest brewery in the world is Compañía Cervecera de Coahuila in Piedras Negras/Nava in Mexico, which AB InBev had to sell to Constellation Brands because of antitrust reasons when it acquired the remaining half of Grupo Modelo’s capital stock in 2013 in a transaction valued at $20.1 billion.

At that time Constellation Brands not only acquired the brewery in Piedras Negras in a $5.3 billion deal but also Grupo Modelo's 50 percent stake in Crown Imports and perpetual rights to Grupo Modelo's brands in the United States, including brands like CoronaModelo EspecialNegra Modelo and Pacífico. 

One year ago Grupo Modelo also sold its 4 million hl brewery in Obregón, Mexico, for a sum of $600 million to Constellation Brands, since the majority of the capacity was dedicated to supply Constellation Brands in an interim agreement, which was to end soon. (inside.beer, 1.11.2016)

"Through this investment, Grupo Modelo reiterates its commitment and long-term vision for Mexico," said Mauricio Leyva, president of AB InBev's Middle Americas Zone & CEO of Grupo Modelo. The manager also said that the expansion became necessary due to increased demand for Corona and “the entire Mexican portfolio” in domestic and export markets.

The announcement already marks AB InBev’s second major commitment to build a new brewery within one week. Last week the company said it would construct a new $250 million brewery in Nigeria to start operation next year. (inside.beer, 23.11.2017)

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