TOKYO, Oct. 26, 2009 (Kyodo News International) --
(Editors: ADDING COMMENTS)
Kirin Holdings Co. said Monday it will close two out of 11 domestic beer plants by next year to boost production efficiency on the back of a saturated beverage market at home.
The move comes as Kirin, Japan's second-largest beer maker as of last year, carries out merger talks with Suntory Holdings Ltd., the No. 3 brewer, to create one of the world's largest beverage and food companies.
Kirin said it will also aim for an operating profit of 188 billion yen on consolidated sales of 2.49 trillion yen by 2012. For the current year through December, the company anticipates an operating profit of 125 billion yen on sales of 2.3 trillion yen.
The company said it will close two plants in Tochigi and Ishikawa prefectures after the peak production period in the summer ends next year.
Of around 330 workers currently at the two plants, Kirin said it will reassign permanent employees to other factories while the contracts of around 100 temporary workers will not be renewed.
Kirin President Kazuyasu Kato emphasized the forecasts and the restructuring of the plants do not take into account the planned merger with Suntory, adding the shutdown will help to ''rectify the discrepancy between sales and production capacities'' of the existing beer plants.
Kirin, which replaced Asahi Breweries Ltd. in No. 1 slot during the January to September period, has been aggressively buying foreign firms in recent years, including Australia's top two dairy firms National Foods Ltd. and Dairy Farmers Ltd.
The merger talks with Suntory also come on the back of a shrinking Japanese beer market with shipments of beer and beer-like drinks in the first nine months of this year dropping 2.4 percent from a year earlier to a record low since comparable data became available in 1992.
''We are seriously and candidly carrying out talks, so we have no intention of wasting time,'' Kato told reporters when asked about the current state of discussions with Suntory.
