Ursus To Pay Over 50,000 EUR/Month For Ten Years To Use Azuga Brand

Izabela Sîrbu

Ursus Breweries, the Romanian subsidiary of SABMiller, has recently acquired local brewery Bere Azuga (RASDAQ:BEGY) and will pay at least 50,000 EUR/month for 10 years to be able to use the Azuga brand. "The re-launch of the Azuga beer brand will give us additional strength on the economy segment in the context that all the other Ursus Breweries brands maintain strong positions on their respective segments," said Stephan Maria Weber, the CEO of Ursus Breweries.

Ursus Breweries will pay the local brewery a flat royalty and a variable part of 3% of their net earnings, but not less than 50,000 EUR/month. The local brewery has ceased operations and sold the rights to the Azuga brand to Ursus Breweries, who will produce and sell Azuga Beer with their own logistics.

Ursus Breweries representatives said talks with the union had already started and all provisions of the framework labour agreement would be observed. Bere Azuga employees will receive severance and support for finding a new job. A final discussion regarding the future of the factory will take place during the General Meeting scheduled for mid-June.

Ursus Breweries, the main shareholder in Bere Azuga, earlier this year lent 10 million EUR to the local brewery to enable them to repay due loans.

Ursus Breweries has an overall production capacity of 7.3 million hectolitres per year and owns four breweries, in Cluj-Napoca, Timisoara, Buzau and Brasov. The company"s brands are Peroni Nastro Azzurro, Ursus, Redd"s, Timisoreana, Ciucas and Pilsner Urquell.