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InBev S.A., the world's largest beer producer, is planning a bold takeover strategy in China, as it eyes the country as the world's largest growing market for beer products.

InBev said that it has just concluded talks to take over Xuejin Beer, a leading beer producer in Fujian Province on China's southeast coast at a cost of 5.88 billion yuan (us$735 million).

"All of the world's major beer producers are fishing in China," said Brent Willis, Asian president of the Belgium-based InBev, here on Friday.

Willis said that China is now the world's biggest beer consumer with an annual beer consumption of 30 million tons, and it is still growing at six to seven percent every year.

"In the coming ten years, half of the world's demand for beer will come from China," Willis expects.

By taking over Xuejin, InBev will acquire three of its former breweries with a total production capacity of 900,000 tons a year, and the brand's strong market share in Fujian and east China's Jiangxi Province.

"The ownership transfer formality is expected to be completed within this year," said Willis.

InBev's current beer sales in China has reached 3.5 million tons a year.

Prior to this deal, InBev had purchased Jinling Beer and KK Beer in east China's Jiangsu and Zhejiang provinces, and grabbed 24 percent of stakes in Pearl River Beer, a brand based in south China's Guangdong Province. Its affiliated brewing bases are dotted in eight Chinese provinces.

"China's beer market has entered a new era with increasing involvement of the world's leading beer producers, such as Heineken and Budweiser, in the country," said Willis.

(Xinhua News Agency January 28, 2006)