RIGA - A Danish brewer was reportedly positioning itself to buy Lacplesa Alus, Latvia's fourth largest beer producer and distributor. The Dienas Bizness daily reported last week that the Danish Brewery Group, the second largest Scandinavian brewery, was in talks to buy the Latvian beer producer.
An informed source told the daily that an agreement had been made and official information could be released within a week.
The likely amount of the deal was reported as 6 million euros - 7 million euros.
This would be the second major acquisition for the Danish company in recent weeks, as in late July it bought 100 percent in Cido Partikas Grupa, Latvia's largest producer of fruit and vegetable juices.
Lacplesa Alus co-owner Sergejs Malcevs was not available for comment and the brewery's board chairman, Igors Drozdovs, refused to comment, citing agreement confidentiality.
He said that any detailed comments from the company could be expected no earlier than the second half of September.
The Danish Brewery Group further refused to comment on the possible deal, as it is bound by strict disclosure rules on the stock exchange.
Latvian Breweries Union President Janis Duklavs did confirm that there had been talk about the possible sale of Lacplesa Alus for quite some time, information corroborated by other sources in the industry.
Speaking about likely effects on the industry, Duklavs said the competition would grow tougher and beer imports from Lithuania would increase.
Lacplesa Alus has a significant part of its beer brewed in other countries, including Lithuania, where the Danish Brewery Group owns the Kaunapilio-Tauro brewer.
According to the breweries union, Lacplesa Alus ranked fourth in Latvia by seven-month beer sales, taking 7.7 percent of the market, 3.3 percentage points lower from last year's result.
In 2003 Lacplesa Alus generated 6.4 million lats (9.7 million euros) in sales, an increase by 20 percent year-on-year.
The Danish Brewery Group's net sales last year stood at 353.5 million euros and profit after taxes was 20.5 million euros.