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Case from journal
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Reference no. NAC2109
Published by: NACRA - North American Case Research Association
Published in: "The Case Research Journal", 2001
Length: 34 pages
Data source: Field research

Abstract

Lion Mathan entered the fastest growing region of the Chinese beer market in 1995 with a 60% joint venture in Wuxi. Their second step was a bold commitment to build a large world-class brewery in the nearby Suzhou Industrial Park. By 1999, the company faced intense competition in the premium segment from all of the world''s leading brewers and the economy was cycling downwards. In April, a new license deal to brew and market Beck''s premium beer was announced. But the mid-year report showed that the China operations were tracking further into the red. How would the Board and the New Zealand shareholders react to another loss from China? How could Lion Nathan survive the shakeout in the world''s most exciting and challenging beer market?

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Abstract

Lion Mathan entered the fastest growing region of the Chinese beer market in 1995 with a 60% joint venture in Wuxi. Their second step was a bold commitment to build a large world-class brewery in the nearby Suzhou Industrial Park. By 1999, the company faced intense competition in the premium segment from all of the world''s leading brewers and the economy was cycling downwards. In April, a new license deal to brew and market Beck''s premium beer was announced. But the mid-year report showed that the China operations were tracking further into the red. How would the Board and the New Zealand shareholders react to another loss from China? How could Lion Nathan survive the shakeout in the world''s most exciting and challenging beer market?

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