New plant to add 25 per cent to S&N's cider production

30 November, 2007

Scottish & Newcastle has entered into a joint venture with Herefordshire company

the Q-Group to open a second cidermaking site in the county.

The new

plant in Ledbury will enable S&N to increase production of its cider brands by 25 per cent without having to invest in the current Bulmers site in Hereford.

Stephen Glancey, group operations director for S&N, said: "This is a good long-term strategic solution to manage the rapid growth of the cider industry while ensuring that we remain loyal to our Herefordshire roots"

"We are already looking to increase the acreage of apple orchards in the area, which is one of the best places in the world for growing cider apples. The additional milling and cidermaking capacity that this

joint venture will generate ensures that we can continue to lead the market in the future with a consistent supply of high quality ciders."

Under the initial 10-year deal, the Q-Group will manage all apple milling and processing

at the new site, which will have the capacity to produce 1 million hl.

Earlier this year S&N announced it was planting an extra 400,000 apple trees in Herefordshire .

S&N currently

claims a 52.7 per cent share of the total cider market and has seen double-digit growth for Strongbow for the past three years.

The launch of two new brands this year - flavoured cider Jacques and Bulmers Pear - have also contributed to the increase in demand for its brands.

The news of the joint venture was released with the drinks giant's third quarter trading statement, in which the company also announced plans for Heritage Drinks

to take on brand management and marketing support for its second-tier cider brands and heritage ales.

S&N is the subject of a hostile takeover bid by Carlsberg and Heineken.

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