Cobra beer comes home to roost in UK

The owners of Cobra beer have decided to switch production back to the UK just three years after outsourcing production to Poland, blaming rising transport costs and the strength of the Polish Zloty.

Cobra, which has just recruited advisors to find potential buyers for the business, says the move could save up to £7M if its target of brewing 1M hectolitres annually in Britain by 2010 is achieved.

From July 31, production will shift to Camerons (draught and bottled), Wells & Young's (draught) and one other unnamed brewer (bottled and canned), which will make Cobra under licence, said the firm.

It has also struck a deal with Quinn Glass to bottle selected lines of its beer, with the remainder of the business going to Palm Breweries in Belgium, which will produce brands including Cobra Zero %, Cobra Light and King Cobra.

Analysts said that the Cobra sale was likely to interest all of the major brewers, from Carlsberg, SABMiller and Molson Coors, plus some smaller Indian firms.

The company, which was founded in 1989 by Karan Bilimoria, is growing at more than 30% year-on-year and aims to achieve sales of £100M by 2009.