| Mon 16 Sep 2002, 17:44 | | Trencor In R400 Million Beer Keg Deal With Another |
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TRENCOR IN R400 million BEER KEG DEAL WITH ANOTHER TOP UK BREWER
TRENCOR LIMITED
PRESS RELEASE
16 September 2002
In a R400 million deal TrenStar Inc, a 61% US-based subsidiary of
Trencor Limited, has bought the entire beer keg fleet (over one million
containers) of Carlsberg-Tetley Brewing Limited, a major beer brewer in
the UK and a wholly-owned subsidiary of Carlsberg Breweries A/S of
Copenhagen, the fifth largest brewing group in the world. TrenStar will
manage and make the kegs available to Carlsberg-Tetley under a container
services agreement for a period of 15 years. The fleet purchase, which
will be completed in three phases, was funded by a major UK bank, ring-
fenced to the special purpose subsidiary now owning the kegs and thus
without recourse to TrenStar or Trencor.
This transaction follows on the earlier similar transaction,
announced in May 2002, in terms whereof TrenStar acquired the entire keg
fleet of Scottish Courage Limited, the UK`s leading brewer and part of
Scottish & Newcastle plc, one of the largest brewers in Europe.
"These two transactions together mean that TrenStar has positioned
itself to become the owner and manager of the first-ever high-value
asset pool to be shared by major competitors in the beer industry" says
Hennie van der Merwe, Trencor executive director. "The planned TrenStar
keg pool will allow competing European brewers the opportunity to share
common keg assets and common supply chain components and activities. As
a result, they benefit through improved return on capital, lower and
more predictable operating costs and improved customer service levels.
Additionally, since TrenStar will purchase and take ownership of the
kegs in the pool, significant capital is freed for pool participants to
use for other, more strategic purposes."
The European brewing industry will be the first asset-intensive
industry to validate TrenStar`s unique asset pooling solution that
combines proven technology and keg management experience with supply
chain operational excellence.
"As one of the largest brewers in the UK, Carlsberg-Tetley has a
vision of being simply the best in brands, service, people and costs.
Carlsberg-Tetley has invested millions in new technology and modernizing
and streamlining its breweries to improve capacity and efficiency and is
pleased with its new partnership with TrenStar. We believe the TrenStar
partnership will support our overall strategic direction and will help
to further strengthen Carlsberg-Tetley`s position in the UK," says
Andrew Caswell, Carlsberg-Tetley`s Strategic Planning Director.
Greg Cronin, TrenStar`s CEO explains: "Costly returnable assets, like
stainless steel kegs, which have real, intrinsic or strategic value
often require large cash investments to purchase and additional IT
investments to track and manage. Many companies in asset intensive
industries are realizing that they can join asset pools with competitors
and greatly reduce their cost structure while not losing any strategic
advantage. They are realizing that joining a neutrally owned and managed
asset pool will offer competitive advantage over those competitors that
don`t join. Our European keg pool will represent the first industry
asset pool but we are well on our way to developing asset pool solutions
for other industries including the automotive, chemical and food
industries."
Neil Jowell, Executive Chairman of Trencor, said the transactions
would not contribute materially to earnings in the current year.
"However, the creation of industry pools of high value assets managed by
Trencor subsidiaries as neutral and reliable suppliers is expected to
become a significant component of the Trencor group`s hard currency
earnings, adding to that from subsidiaries such as Textainer, the world
leader in dry freight marine container leasing", he added.
TrenStar, which operates in the USA as well as the UK and Australia,
and Trencor Solutions in South Africa provide solutions for supply chain
execution, automatic data collection, management and integration of
returnable assets of the supply chain for the beverage, food, chemical,
automotive and other asset-intensive industries.
Ends
Enquiries: Hennie van der Merwe, Trencor Executive Director
Telephone 021 421 7310
Cellphone 083 255 6343
Date: 16/09/2002 05:25:00 PM Produced by the JSE SENS Department
