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Brewing expertise extends to Russia

A Lorien Engineering Solutions product story
Edited by the Engineeringtalk editorial team Oct 9, 2006

Lorien Engineering Solutions has taken its brewing expertise across new borders this year, having recently completed a major valuation assignment for Efes Breweries International.

Lorien Engineering Solutions, the Lichfield-based project management specialist, has taken its brewing expertise across new borders this year, having recently completed a major valuation assignment for Efes Breweries International (EBI).

The project involved the valuation of individual fixed assets to establish the market value of two Russian breweries acquired by the Efes group.

Lorien made two five-day visits to the breweries in Novosibirsk and Kazan to view the plant using fixed asset registers supplied by Efes, to assess the quality and condition of the plant and to establish their operational utilisations.

The brewery at Novosibirsk is a Greenfield project development, located 15km from the city centre, that started production in 2002 with an annual brewing capacity of three million hectolitres and comprises plant of mainly Western European origin.

The Kazan brewery dates back to 1872 when it was founded and built in the centre of Kazan, one of Russia's largest cities, and a major industrial, commercial and cultural centre.

The brewery has been the focus of modernisation and expansion works over the last seven years, and currently has an annual capacity of seven million hectolitres.

In addition to the brewery, there are also three malt factories on the site, with an annual capacity of 93,000 tonnes.

The maltings output is used by the site and is also distributed to the Novosibirsk brewery and other independent brewers.

Lorien project manager John Vakis explains the scope of Lorien's work: "The basis of our valuation methodology is to evaluate the present day value by applying tried and tested depreciation 'value' curves to the original asset values".

"The resulting plant and equipment values are then benchmarked against prices of second-hand equipment available in the marketplace".

"Similarly, buildings and infrastructure values are compared against typical costs for the region".

"In addition, consideration is given to utilisation and maintenance levels, and adjustments are made to the valuations as appropriate".

EBI currently operates 10 breweries in the Russian Federation, Kazakhstan, mouldova, and Serbia and Montenegro.

Russia is the world's fifth largest, and Europe's fastest growing beer market.

Earlier this year, Lorien undertook similar valuation assignments on behalf of the Efes Group of Companies at Coca-Cola franchise bottling plants in Jordan, Azebaijan, Kazakhstan and Kyrgystan.

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