Pilsner Urquell, the super-premium Czech beer brand owned by SABMiller, is to be produced in Poland under licence for the first time.
The agreement between Plzensky Prazdroj, the Czech brewer which makes Urquell, and the Tychy brewery in Poland, also part of the SABMiller group, is consistent with the parent company's desire to extend production and distribution of the famous Czech beer.
SABMiller said that it had carried out extensive tests at the Polish brewery to ensure that the quality of the beer there was the same as that produced in Pilsen, and that this would be the main criterion for all future licensing deals as well.
The beer will be made using the same production process and the same ingredients as in the Czech Republic, the company said, with even the water said to have the same qualities. A Pilsen brewmaster will be responsible for ensuring the quality of the licensed production and will be based in Tychy.
Plzensky Prazdroj said that the fact that both it and Tychy were part of the same group meant that it was much easier to co-ordinate and oversee production of the beer.
Poland is an important market for Pilsner Urquell, with sales reaching 108,000 hectolitres in 2001, up 58 per cent on the previous year. Poland is the fifth largest beer market in Europe and has attracted a great deal of interest from other leading brewing groups over the last few years, including Interbew, Carlsberg and BBAG.
"Pilsner Urquell is the flagship brand of the SABMiller portfolio. It belongs among the top international brands today and we are confident that our target to get Pilsner Urquell into the top five worldwide in sales is a realistic target," said Tony van Kralingen, CEO of Plzensky Prazdroj.
"We appreciate Pilsner Urquell as a jewel with huge potential and our approach to its licensed production has been managed thoughtfully and professionally, ensuring each detail is covered," he added.
The company said that licensed production was successfully used by many of the world's leading beer brands such as Guinness, Heineken or Stella Artois, although it is the first Czech brewer to follow this strategy. It already has several years of experience in licensing production of its lesser brands Gambrinus and Velkopopovicky Kozel.
The Plzensky Prazdroj group owns three breweries in Pilsen, Radegast and Velke Popovice breweries in the Czech Republic, as well as the Saris brewery in Slovakia. It produces almost 8 million hectolitres of beer a year and is the largest brewing company in Central and Eastern Europe.
The decision to licence production is one which is likely to be met with dismay by beer aficionados worldwide, even it means that they will be able to get hold of Pilsner Urquell more easily. The Czech Republic's reputation as a brewer of top quality beer is well founded, but despite SABMiller's claims that the quality of Urquell will remain the same when brewed in Poland, transferring production to Poland will inevitably mean a change in taste.
While licensing production makes perfect sense from an economic point of view - the Urquell brand has considerable equity - beer drinkers may not agree if it comes at the expense of quality. While it is certainly true that many major brands have become successful worldwide because of licensing, this has almost always been at some cost. Ask anyone in Ireland whether the Guinness sold elsewhere in the world tastes the same and they will always say no, while other brands such as Stella and Heineken are, with the best will in the world, hardly in the same class as Urquell when it comes to richness of flavour.
History suggests that that the brands which have the best worldwide penetration are those with the blandest flavour, not only because they are more suitable to a variety of palates but also, more crucially, because they are easier to recreate anywhere. If SABMiller can do what it claims and copy the quality of Urquell wherever it is licensed, then it will have a major advantage - but if a greater proportion of the world's beer drinkers can finally have access to the brand, does this really matter anyway?