The terms of the agreement would have seen Quarto distribute Heineken beer through to the completion of the company’s Yangon brewery, likely in late 2014. However, the deal appears in doubt following a raid on Quarto’s premises, which resulted in more than K600 million worth of food and beverage products being seized. The company’s managing director was arrested and went on trial on November 22.
The raid came as a part of a nationwide government crackdown on illegal food and beverage imports over the past two months. However, despite the confiscation of tens of thousands of bottles of alcohol from Quarto, the company was allowed to resume sales on December 2.
Mark Campbell, a spokesperson for Heineken Asia Pacific, told The Myanmar Times that the planned distribution deal would see Quarto import Heineken using the import licences of Myanmar-based hotels.
“We currently have no formal written agreement with Quarto, but we have engaged them to help us list and distribute our brands into some hotels,” Mr Campbell said.
“We have been planning a more formal distribution arrangement with Quarto before our new brewery is built. In terms of imports we would like to be able to import our beer through the hotels in advance of the brewery being completed by this time next year.”
“Our discussions with Quarto are ongoing ... The details of any distribution contract are commercially sensitive so we are not able to share this information. It is also still early days for us to be able to form a view of what a future more formal market looks like.”
He said Heineken also cooperated with Quarto on an Oktoberfest event at Parkroyal Hotel. The two companies had planned to host a joint booth at the MyanFood ’13 food and beverage exhibition in early November, Mr Campbell said, adding that it “didn’t go ahead” – because Quarto had been forced to close by the Ministry of Commerce.
There is no evidence to suggest that the planned distribution arrangement and Quarto’s recent problems are linked. Government officials say the recent raids were launched based on tip-offs.
“Currently, we are able to seize alcohol in any case where we are getting information,” U Win Myint, director of the Ministry of Commerce’s Directorate of Trade, told The Myanmar Times last month.
The ministry does not consider the motivation or background of the informant when it receives and acts on information about potentially illegal imports. U Aung Than Soe, the lawyer for Quarto’s managing director, suggested however that the informant in the case “might be a competitor of Quarto”, but noted that the ministry would not be required to reveal the person’s identity to the court during the trial.
In May, Heineken announced that it had reached a deal to invest US$60 million in a brewery in partnership with Alliance Brewery Company, which is owned by U Aung Moe Kyaw, whose IBTC Group also produces Grand Royal whisky.
Heineken’s 57-percent stake in the brewery is through subsidiary Asia Pacific Breweries, which the brewing giant – the world’s third-largest beer company – bought outright last year. APB pulled out of a deal with army-owned Union of Myanmar Economic Holdings Limited to build a brewery in 1996 and was replaced by Fraser & Neave. The latter owns 55pc of their joint venture company, Myanmar Brewery Limited, which produces Myanmar Beer, Tiger Beer and ABC Extra Stout.
Meanwhile, Quarto Products resumed deliveries on December 2 and sent an expanded list of products to its clients, including hundreds of types of wine from Australia, France, Italy and Spain, along with liquors such as cognac, grappa and kirsch. It was unclear how the products had been imported and the company declined to comment.
“We are able to resell again our products ... And we would like to say thank you all [for] supporting and helping us during this period,” Quarto’s sales manager said in an email to customers on November 30.
source: The Myanmar Times
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