Asahi Group Holdings: long-term performance & turning pointsSales (revenue) and profit-margin ratio
Sales (¥ bn)Net margin (%)
1949A tilt to western Japan inherited from the break-up, and a quarter-century of falling share
Revenue (¥ bn, bars) · net margin (%, line)
Source: securities reports
FY1960 · unconsolidated
Revenue$141M
Net income—
Net margin—
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FY1981 · unconsolidated
Revenue$900M
Net income$6M
Net margin0.7%
1949Dai Nippon Beer is split; Asahi Breweries is founded in September
1949Shares listed on the Tokyo Stock Exchange in October
1954Equity stake taken in Nikka Whisky
1957Asahi Gold launched, building the name of the Asahi of technology
1958Japan's first canned beer goes on sale
1962Omori plant completed in Tokyo
1963Falls to third place in the domestic beer market
1964Asahi Stiny opens new demand in the home
1965Outdoor fermentation tanks patented; first export of brewing technology
1966Kashiwa plant, dedicated to soft drinks, comes on stream
1973Nagoya plant completed
1976Enmei Naomatsu, from Sumitomo Bank, becomes president
1979Fukushima plant completed
1981Juzenkai buys up shares; the Maru-yu cuts remove 500 employees
For its first three decades Asahi grew and lost at the same time: sales rose from $141.1M (¥51bn) in 1960 to $899.6M (¥198bn) in 1981, while its share of the Japanese beer market fell from 36.1 per cent to 10.2 per cent. New plants, patented tanks and a run of national firsts could not offset a production base weighted to western Japan and a sales network that never reached the households where beer was increasingly being drunk, and by 1981 the question was no longer growth but survival.
Four plants and two brands: the founding of Asahi Breweries
In September 1949 Dai Nippon Beer, a brewer with fifty years of history behind it, was split into two companies under the Act on the Elimination of Excessive Concentration of Economic Power, and Asahi Breweries (朝日麦酒) was incorporated as one of the two successors with capital of $277,778 (¥100m). As productive plant it inherited four factories — Azumabashi, Suita, Nishinomiya and Hakata — and as its principal brands Asahi Beer and Mitsuya Cider, and Yamamoto Tamesaburo (山本為三郎) became its first president. Initial capacity across the four plants was about 520,000 koku of beer (koku, a traditional Japanese measure of volume) and 630,000 cases of soft drinks. Three of the four plants, however — Suita, Nishinomiya and Hakata — stood in western Japan, so the break-up left the company's operating base tilted to the west; nor could it adapt to the change in the structure of demand as the main battleground of consumption moved from bars and restaurants to ordinary households.
As the fruit of the technical innovation it had pursued since its founding, Asahi brought out one new product after another. Asahi Gold, a speciality beer launched in 1957, raised the name of the Asahi of technology and was the first real step in the post-war improvement of beer quality in Japan. The following year, 1958, it launched Japan's first canned beer and set out to open up new demand, and Asahi Stiny (アサヒスタイニー), launched in 1964, opened new demand in the home. The outdoor fermentation and storage tanks the company developed and installed unaided in 1965 worked to stabilise quality and cut manufacturing cost; they were patented in Japan, the United States and Belgium, and a patent licensing agreement was concluded with Ziemann, the West German brewing-equipment maker — Japan's first export of brewing technology. As one move to widen its range of alcoholic drinks, it took an equity stake in Nikka Whisky in August 1954.
The Omori plant in Tokyo was completed in May 1962 and the Kashiwa plant, dedicated to soft drinks, came on stream in December 1966, but sales volume did not keep pace with the added capacity and the gap with Kirin Brewery only widened. Shares of shipment volume in the domestic beer market changed places: from Asahi 36.1 per cent against Kirin 25.3 per cent in 1949 to Asahi 24.3 per cent against Kirin 46.5 per cent in 1963, the year Asahi also fell below Sapporo's 26.3 per cent to third place in the industry. The decline did not stop there — in 1983 Asahi stood at 10.2 per cent and Kirin at 61.3 per cent. Between the break-up and 1985 beer consumption in Japan swelled roughly thirty-five-fold, while Asahi Breweries' own sales volume grew only ninefold.
A run of presidents seconded from Sumitomo Bank, and the crisis of 1981
Sumitomo Bank, the main bank, sent two of its own men in succession to the presidency of Asahi Breweries: Takahashi Yoshitaka (高橋吉隆) in 1971 and Enmei Naomatsu (延命直松) in 1976. Enmei had joined Sumitomo Bank in 1939 and served as far as managing director; he entered Asahi Breweries as executive vice-president in February 1971, became vice-president in August 1974 and president in February 1976. Capacity continued to be added meanwhile — the Nagoya plant was completed in April 1973 and the Fukushima plant in March 1979. Yet six years in office did not turn performance around, and the share of domestic beer shipments fell further, from 11.8 per cent in 1976 to 10.2 per cent in 1981. Murai Tsutomu (村井勉) would later describe this long descent as having dropped share like Niagara Falls.
In 1981 two things came together — the buying-up of Asahi shares by Juzenkai, a medical corporation in Kyoto Prefecture, and the large restructuring known as Maru-yu (マル優) — and anxiety among employees about the crisis and about the company's survival rose. The staff cuts were carried out that same year under the name of a preferential measure for honourable retirement, and more than 500 employees left Asahi Breweries. The chairman of the labour union at the time left the words hell if you go, hell if you stay in the company history published for the 120th anniversary of the founding. The man who dealt with management as the union's general secretary in those negotiations was Izumiya Naoki (泉谷直木), later president. Izumiya had spent five years at the Hakata plant and then six years as a full-time union official, after which he was posted to public relations, one of the company's prestige departments.
As of 1982 Asahi Breweries was in a state of piling retreat upon retreat, standing at the brink of whether its share would fall below 10 per cent. Its share of shipment volume that year was indeed 10.0 per cent against Kirin's 62.2 per cent — a gap of 52 points. On Murai Tsutomu's analysis, the cause of that gap was that Kirin Brewery had locked up the household sales channel, which accounted for seventy per cent of the market; regionally it showed up as a lopsided sales network, strong in the cities and weak in the provinces. That year Sumitomo Bank sent in a third president, its deputy president Murai Tsutomu. In July of the same year the company merged its subsidiary Ebios Pharmaceutical (エビオス薬品工業), taking the pharmaceutical field into the parent.
1982A rebuild that began by remaking the corporate culture, and a total change of taste
Revenue (¥ bn, bars) · net margin (%, line)
Source: securities reports
FY1982 · unconsolidated
Revenue$810M
Net income$5M
Net margin0.6%
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FY1989 · unconsolidated
Revenue$4.7B
Net income$43M
Net margin0.9%
1982Murai Tsutomu comes from Sumitomo Bank as president in March
1982Subsidiary Ebios Pharmaceutical merged into the parent
1984TQC declared, with Murai himself as head of the promotion office
1985Corporate identity declared; the New Century Plan
1985Share falls to 9.6 per cent, the lowest since the break-up
1986Asahi Draft Beer, the Koku-Kire beer, halts the 25-year slide
1986Higuchi Hirotaro becomes president in March
1987Asahi Super Dry launched in March
1987Annual plan revised up from one million to eight million cases
1988Standalone sales reach $4.3B (¥545bn)
1989Share reaches 24.9 per cent; Asahi holds 73 per cent of the dry category
1989Renamed Asahi Breweries in January; Akashi soft-drinks plant completed
Two men sent from Sumitomo Bank turned Asahi round in eight years, and neither of them started with the product. Murai Tsutomu spent four years remaking the culture through training, TQC and a corporate-identity programme, and Higuchi Hirotaro then bet the company on an entirely new taste — a sequence that took standalone sales from $1.5B (¥259bn) in 1986 to $4.3B (¥545bn) in 1988 and lifted share from a post-break-up low of 9.6 per cent to 24.9 per cent.
Murai Tsutomu begins the rebuild with education and corporate identity
In March 1982 Murai Tsutomu, deputy president of Sumitomo Bank, became president of Asahi Breweries. From 1976 Murai had been seconded as executive vice-president to the loss-making Toyo Kogyo (now Mazda), where he had shown striking managerial skill in its rebuild, and he held to the conviction that without selling there is no company. Where Toyo Kogyo had been a secondment, this time he resigned from Sumitomo Bank, saying he was prepared to lay his bones at Asahi. After taking office he travelled the country from north to south, holding knee-to-knee talks with customers and employees, pouring his effort into getting them to hold a sense of the problem, a sense of crisis. He gave up whisky and drank only beer himself, and he withdrew from the anti-karaoke campaign he had championed as a matter of principle, on the grounds that it would antagonise the bars that were the company's on-trade channel.
Asked what the way out was, Murai's answer was neither capital spending to raise output nor price-cutting, but first, to remake the corporate culture. Asahi had plenty of clever employees, but cleverness alone left them weak in the legs; selling beer and gathering deposits were much the same thing, and once the target was set all that remained was to strengthen the legs and walk the earnings in — that was the diagnosis of a man who had come through rebuilds in both banking and manufacturing. A culture does not change easily, so the decisive thing is education, he said: putting people through training and drilling them thoroughly was the short way round, and he ordered a training centre built himself. While the near-term task was to raise share to where the company could feed itself, there was also the question of what kind of company it should become, and from his first year in office he spoke publicly of CI, QC and diversification into four fields — alcoholic drinks, soft drinks, food and pharmaceuticals.
Execution came in stages. In January 1984 he declared the introduction of TQC and took the chair of the promotion headquarters himself, and in October 1985 he declared the introduction of a corporate identity programme. The man named to lead CI was Izumiya Naoki, from public relations; the nickname chosen from entries submitted by all employees was the New Century Plan. The decline in share itself continued through Murai's term, reaching 9.6 per cent in 1985, the lowest since the break-up. Four months after the declaration, in February 1986, the company launched Asahi Draft Beer (アサヒ生ビール) — popularly the Koku-Kire beer, for its body and its sharp finish — with the company logo redrawn under CI and both taste and label renewed; the quarter-century slide in share was arrested and the year's share recovered to 10.2 per cent. Beer-division sales in 1986 rose 12 per cent on the year, far above the industry average of 3.9 per cent. In March of that year Murai stepped up to the chairmanship after four years in office, and was succeeded by Higuchi Hirotaro (樋口廣太郎), who had come in as an adviser in January 1986 from the deputy presidency of Sumitomo Bank.
Betting on a total change of taste with Super Dry
As Higuchi Hirotaro saw it, beer was an oligopoly protected by licensing, the tastes of the four major brewers were much of a muchness, and there was even a degree of comfort taken in the fact that blind tests failed to identify the brand. A ten per cent share was also the dividing line for survival: fall below ten and the product vanishes from five or six shops in ten, whether in Akihabara in Tokyo or Nipponbashi in Osaka. Indeed, when Higuchi became president in 1986, only 47 per cent of outlets in Tokyo stocked Asahi. He therefore adopted a policy of putting out an entirely new product and differentiating on what was inside, asked his technical staff to confine themselves to assisting the consumer, and narrowed the taste down through repeated tastings of twelve trial beers. So it was that in March 1987 Asahi Super Dry, a dry draught beer, went on sale.
The bet was underwritten by fundraising: Higuchi built up the company's investment assets through market-price share issues, convertible bonds and foreign bond issues. At the end of the December 1987 financial year shareholders' equity stood at $552.6M (¥80bn), 2.4 times the previous year's, and investment assets had risen by $249M (¥36bn) to $541.5M (¥78bn). With the financial income those assets generated as the source, sales-promotion spending in 1987 was raised by $86.4M (¥13bn) on the year to $262.8M (¥38bn) and advertising by $49.8M (¥7bn) to $131.4M (¥19bn). His touchstones were the two principles the industry's elders had given him on his courtesy calls as incoming president: quality first and fresh rotation. To protect freshness the company took what is said to be the industry's first step of buying back and scrapping old beer left sitting in the distribution chain rather than selling it at a discount. The effect of that spending showed in shelf placement: the new draught beer reached 70 to 80 per cent of outlets in Tokyo, and Super Dry 99.8 per cent.
Sales ran ahead of the demand forecast. Against an initial annual plan of one million cases, three million had already been sold by the end of June, before the peak of summer, and the plan was revised up to eight million. To meet demand in the Tokyo area the Tokyo plant was put entirely onto Super Dry, and other beers were supplied by transport from plants outside the block. Beer-division sales in January–June 1987 rose 25 per cent on the year, far above the industry average of about 8 per cent. Standalone sales expanded from $1.5B (¥259bn) in the December 1986 year to $2.4B (¥345bn) in December 1987 and $4.3B (¥545bn) in December 1988, and share grew from 12.9 per cent in 1987 to 20.6 per cent in 1988 and 24.9 per cent in 1989. The rival dry products the other brewers launched one after another widened the dry category itself, and of the 30 per cent of the 1989 beer market that dry accounted for, Asahi held 73 per cent.
1990Clearing up after the financial engineering, and a long rebuild at home
Revenue (¥ bn, bars) · net margin (%, line)
Source: securities reports
FY1991 · consolidated
Revenue$6.8B
Net income$36M
Net margin0.5%
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FY2012 · consolidated
Revenue$19.8B
Net income$716M
Net margin3.6%
1990A 50-month run of outgrowing Kirin ends; Kirin launches Ichiban Shibori
1991Ibaraki plant completed
1992Seto Yuzo, the first career insider, becomes president; debt near $11.1B (¥1.4tn)
1994Full-scale entry into China begins
1995Management control of two Chinese companies taken jointly with Itochu
1996Super Dry becomes the top brand for a single month in June
1998Overtakes Kirin in domestic beer — first in 45 years; Shikoku plant opens
1999A $295.2M (¥34bn) loss booked at AB Service
2001The happoshu Honnama launched
2002Liquor businesses acquired from Kyowa Hakko and Asahi Kasei; Ikeda Koichi president
2006Wakodo acquired; Ogita Hitoshi becomes president
2008Clear Asahi launched; Asahi Soft Drinks made a wholly owned subsidiary
2009The lead in beer-type drinks is handed back to Kirin
2011Pure holding company formed; renamed Asahi Group Holdings
2012Calpis acquired from Ajinomoto
The reversal was followed by the bill for it: about $4.3B (¥600bn) of capital spending in six years, interest-bearing debt of some $11.1B (¥1.4tn) by 1992, and the first career Asahi president, Seto Yuzo, brought in to clear the wreckage. The company took the domestic beer crown from Kirin in 1998 for the first time in 45 years, but the question of a business standing on the single leg of Super Dry stayed open, and the sales of $19.8B (¥1.58tn) it reached by 2012 rested on a portfolio still being assembled by acquisition.
The burden left by financial engineering and vast capital spending
In May 1990 Asahi's growth rate in shipment volume among the brewers came in at 8 per cent, the same as Kirin's, and the momentum that had carried it above Kirin every month since the launch of the Koku-Kire beer in February 1986 broke after 50 months. Isuto (イースト), the brand it had hoped would become a second mainstay, had been sold on a limited basis in the Tokyo area the previous year, but against a target of ten million cases shipments came to only three million. Kirin's Ichiban Shibori, launched in mid-March 1990, passed five million cases within just two months of going on sale, breaking Super Dry's record of five million in five months. In this period Asahi's share stalled at 24 per cent, and Seto Yuzo later looked back on 1990 and 1991 as hard years.
The investment that had supported the expansion came back as fixed cost: some $4.3B (¥600bn) of capital spending was carried out over six years in Higuchi's time, an order of magnitude above the $50.7M (¥7bn) to $58M (¥8bn) a year the company had spent before. The operating margin in the 1989 financial year was 1.7 per cent, close to half Kirin's 3.2 per cent; sales of $4.7B (¥655bn) were only a little over half Kirin's, yet advertising spending of $223.2M (¥31bn) was $30.4M (¥4bn) above Kirin's, and sales-promotion spending including selling commissions came to $439.2M (¥61bn), close to a tenth of sales. Against 1989 operating profit of $80.4M (¥11bn) the financial surplus was $78.3M (¥11bn). The depreciation burden was set to rise by $69.1M (¥10bn) on the year to $172.6M (¥25bn) in the 1990 financial year and to $260.2M (¥35bn) in 1991, the peak of the write-down.
By 1992 interest-bearing debt had swollen to about $11.1B (¥1.4tn), the top appointments seconded from Sumitomo Bank for more than two decades came to an end, and Seto Yuzo (瀬戸雄三), a career Asahi man, became president. What Seto set about was sweeping away the negative legacy of Higuchi's era, with Izumiya Naoki — who had been at the centre of the expansion — handling the clean-up as head of corporate planning. Abroad, the company extended its footing through equity participation, beginning a full entry into China in January 1994 and, in December 1995, acquiring management control of two Chinese companies jointly with Itochu. The disposal of bad assets dragged on: in November 1999 it booked a loss of $295.2M (¥34bn) at AB Service (エービーサービス), a company set up in 1991 with an eye to redeveloping the site of the former Tokyo plant. Land and securities collateral values had fallen and the interest burden on heavy borrowings had accumulated until the company was insolvent. What made it possible to take the charge early was restructuring funds such as the securitisation of the Tokyo plant land and a $120.3M (¥14bn) gain on the sale of shares in the listing of Asahi Soft Drinks.
Top of the market after 45 years, and the question of standing on one leg
The counter-attack showed in the numbers: in June 1996 Super Dry rose to be the top brand for the month. In taxed volume for January 1997, Asahi's 10.301 million cases against Kirin's 9.996 million put it first in monthly share as a company as well. Then in 1998 it overtook Kirin Brewery in the domestic beer market for the full year, becoming Japan's number one for the first time in 45 years. Sales for the December 1998 year were about $7.9B (¥1.03tn) and recurring profit $384.3M (¥50bn), both records. Its share of beer alone reached 39.5 per cent, though across the whole market including happoshu — low-malt beer taxed at a lower rate — it stood at 34.2 per cent.
Having reached the top, Asahi held to a policy of not entering the low-priced happoshu segment, and Seto Yuzo said that happoshu was not beer under the liquor tax law and that the other three companies were taking a detour because they could not win on beer alone. His own summing-up was that a focus strategy — polishing the taste of the beer and fitting product and conduct to the customer — had succeeded. Asked about the risk of a one-legged business betting everything on Super Dry, his answer was that taste surveys of 5,000 people had been run every year since launch and approval ratings were rising, and that looking at the leading Western companies — Coca-Cola, Budweiser, Heineken — one leg was quite enough to get by on. In 2001, however, the company launched the happoshu Honnama (本生), and in January 2002, as it took first place in combined beer and happoshu share for the first time in 48 years, Ikeda Koichi (池田弘一), who had led Honnama's success as head of the alcoholic-beverages division, became president.
The business portfolio was widened by acquisition and business transfer: in September 2002 the company took over the alcoholic-drinks businesses of Kyowa Hakko Kogyo and Asahi Kasei, and in May 2006 it acquired shares in Wakodo. The core beer category faltered, however: shipments of beer-type drinks in the 2005 financial year fell 5 per cent on the year, worse than the domestic market's 3 per cent decline. Shinsei (新生), a third-category beer launched in April 2005, started slowly and had to be reworked as Shinsei 3 after only seven months, while Super Dry fell 8 per cent on the year. In March 2006 Asahi Breweries appointed Ogita Hitoshi (荻田伍), president of Asahi Soft Drinks and not even a director of the parent company, as its president. Ogita had spent 37 years in sales at Asahi Breweries, and after becoming president of Asahi Soft Drinks in 2003 had led that loss-making company to a record profit in the 2005 financial year by strengthening its core brands and cutting costs.
The move to a holding company, and a staple bought in Calpis
Breaking free of the dependence on Super Dry took shape under Ogita: Clear Asahi, a third-category beer launched on 25 March 2008, used malt as its raw material, unlike the earlier new-genre products made from soya beans and peas. It passed a cumulative taxed shipment volume of eight million cases within six months of launch, and the first-year sales target was revised up from ten million to thirteen million cases. Even so, the Asahi Breweries group's earnings structure was dependent on alcoholic drinks, which earned close to seventy per cent of sales and ninety per cent of operating profit. Ogita spoke of the need to change the business structure in the light of the size of the soft-drinks and food markets, and kept taking in non-alcohol businesses: a capital and business alliance with Kagome in 2007 and the acquisition of shares in Amano Jitsugyo in July 2008.
In 2009 Asahi handed back to Kirin the leading share of beer-type drinks it had held for nine years. Izumiya Naoki, who became president in March 2010, said that share was a result and also a report card, and took it as the result of how far the company had grasped customer needs at a time when the pull towards lower prices was strengthening. His reading was that share in higher-priced beer had been eaten into and that Super Dry, holding a fifty per cent share, had been affected, and he set the growing of second and third pillars as the task. In the 2010 financial year the company took the share back and earned record profits, and on 1 July 2011 it moved to a pure holding-company structure, changing its name from Asahi Breweries to Asahi Group Holdings. The alcoholic-beverages business was transferred to a wholly owned subsidiary by company split.
Izumiya Naoki set out targets of $25.1B (¥2tn) to $31.3B (¥2.5tn) in sales by 2015 and a place among the world's top ten food companies, and prepared $10.0B (¥800bn) for M&A. The four Australian companies acquired between 2011 and 2012 cost more than $1.3B (¥100bn) in total, but their contribution to earnings was slow, and in the 2014 financial year the company booked a $189M (¥20bn) impairment loss on the goodwill of a New Zealand subsidiary. In October 2012 it acquired Ajinomoto's shareholding in Calpis, changing the parent company that had stood over Calpis since Ajinomoto took an equity stake in 1990. With Calpis under its wing Asahi Soft Drinks became the third-largest soft-drinks company in Japan, but the overseas share of sales in the 2014 financial year was a little over ten per cent, well behind Suntory and Kirin at thirty to forty per cent.
2017Shares in Tingyi Beverage Holding sold, beginning the retreat from China
2018Tsingtao Brewery stake sold; Shoji Akiyoshi's title changed from COO to CEO
2019Agreement to buy Carlton & United Breweries for $11.0B (¥1.2tn)
2020CUB acquisition completes in June, putting the three poles in place
2021Asahi Group Japan established; Maru-ef launched
2022Super Dry wholly renewed; the lead in beer-type drinks retaken from Kirin
2023Matsuyama Kazuo becomes president of Asahi Breweries; two domestic plants closed
2025East African liquor business bought from Diageo for about $3.1B (¥465bn)
Between 2016 and 2020 Asahi spent about $21.5B (¥2.3tn) buying beer businesses in western Europe, in central and eastern Europe and in Australia, and assembled a group standing on three poles — Japan, Europe and Australia. Group sales rose from $17.6B (¥1.71tn) in 2013 to $19.4B (¥2.94tn) in 2024, but goodwill came to more than forty per cent of total assets, and the work of getting out from under Super Dry at home ran alongside it.
Taking on what an antitrust disposal put on the market: two European deals
The opportunity was created by someone else's reorganisation. When Anheuser-Busch InBev, the world's largest brewer, announced in 2015 its acquisition of the second-largest, SABMiller, clearance under the competition laws of the various countries made it necessary to carve out and sell the principal European beer businesses SABMiller held. On 10 February 2016 Asahi agreed to acquire four companies — Birra Peroni of Italy, Royal Grolsch of the Netherlands, and Meantime Brewing and Miller Brands (UK) of the United Kingdom. The total consideration was about €2.55bn (about $3.0B (¥329bn) at the time of the announcement); the acquisition completed on 11 October that year and the final consideration came to about $2.7B (¥294bn). Grolsch has 400 years of history and Peroni more than 150 — premium brands with high recognition, above all in Europe.
The second deal was settled at the end of the same year: on 13 December 2016 Asahi signed a share purchase agreement with AB InBev to acquire the beer businesses SABMiller had held in five central and eastern European countries — the Czech Republic, Slovakia, Poland, Hungary and Romania. The price was €7.3bn (about $8.2B (¥888bn)), and the businesses concerned included Pilsner Urquell, the original pilsner, and held the leading share in the Czech Republic, which has the highest per-capita beer consumption in the world, as well as in Poland, Hungary and Romania. The stock market's reaction was poor: Asahi shares closed 4.6 per cent lower on the day the acquisition was announced. Where beer-industry M&A is generally said to be priced at around twelve times EBITDA, this one was about fifteen times. The acquisition completed in March 2017 and the businesses became subsidiaries.
With central and eastern Europe taken in, group sales for the December 2017 year rose to $18.6B (¥2.08tn) from $17.4B (¥1.89tn) the year before, with operating profit of $1.6B (¥183bn), profit attributable to owners of the parent of $1.3B (¥141bn) and 30,864 employees. The run of acquisitions put the overseas share of sales on course to double from the 13 per cent of the December 2015 year; the eastern European beer businesses acquired held the leading share in four of the five countries and had a high proportion of sales in high-unit-price brands, Pilsner Urquell among them. Within Europe the company also moved to pool raw-material procurement and share distribution channels. At the same time it withdrew from the growth market of China, selling its shares in Tingyi Beverage Holding (康師傅飲品控股) in December 2017 and in Tsingtao Brewery in March 2018.
Three poles completed by the Australian CUB deal, and the weight on the balance sheet
Domestic shipments of beer-type drinks had been falling for fourteen consecutive years as the population aged and young people drank less beer, and the carrier of growth moved overseas. Seven years earlier three in ten employees had worked abroad; by 2019 it was more than five in ten, and an overseas business that had been loss-making had come to account for four-tenths of consolidated operating profit. The driving force was the run of very large acquisitions in 2016 and 2017, in which the company spent more than $10.3B (¥1.16tn) over two years to acquire twelve European brewing companies in all. In July 2019 Asahi agreed to acquire Carlton & United Breweries, Australia's largest brewer, from AB InBev, disclosing a plan to commit $11.0B (¥1.2tn) — the largest sum in its history.
The company sitting second in share in Australia was Kirin, which had made the Australian brewer Lion Nathan a wholly owned subsidiary in 2009 and built its local presence around it. The CUB acquisition put Japan's top two brewers face to face in Australia as well, and against a Kirin whose range was weighted to lower price points, the CUB that Asahi was taking on had a broad range extending into the higher price bands. The burden of financial leverage was heavy too: about $8.3B (¥900bn) was to be borrowed from financial institutions for the CUB acquisition, taking interest-bearing debt to some $18.3B (¥2tn), and the ratio of interest-bearing debt to EBITDA was expected to worsen temporarily from about three times to four. The goodwill and intangible assets that already exceeded $12.8B (¥1.4tn) at the time swelled further with this deal.
The acquisition completed in June 2020, and Asahi had its three poles of Japan, Europe and Australia in place. The conditions at the start were harsh: in the December 2020 year the coronavirus depressed on-trade demand, and group sales were $19.0B (¥2.03tn), operating profit $1.3B (¥135bn) and profit attributable to owners of the parent $869.1M (¥93bn), down from $1.3B (¥142bn) the year before. Asahi set out a policy of lifting the level of profit through sales synergies exploiting CUB's strong distribution network and cost synergies from integrating CUB with the existing business organisationally. In running the group, head office leads in areas where it is better to bundle regions together from the standpoint of overall optimisation, while in areas that should be left to the regional headquarters it has devolved authority, so as to maximise cross-regional synergies.
The work of getting out from under Super Dry
The acquisitions made between 2016 and 2020 came to about $21.5B (¥2.3tn) in total, and goodwill as a proportion of total assets reached more than 40 per cent at Asahi against around 14 per cent at Kirin. Accumulated goodwill carries the risk of impairment — writing the carrying value down should the business environment deteriorate. At home, in 2017, the thirtieth anniversary of its launch, Super Dry's shipments fell below 100 million cases for the first time in 29 years. Shoji Akiyoshi (小路明善) said he would not fixate on sales volume but would put weight on profitability, and, arguing that defending shipments of 100 million cases in a shrinking market would take large promotional costs, placed the emphasis on strengthening the better-margin cans sold to households.
The executive structure was changed too: in March 2018 Shoji Akiyoshi's title was changed from COO to CEO and the COO post was left vacant. The judgement was that with management growing more global after the large European acquisitions, speed of decision-making was essential. At home, Maru-ef (マルエフ), launched in 2021, passed six million cases of shipments in 2022 and grew into the brand ranking next to Super Dry; in the same year the company renewed Super Dry's brand image, packaging and communications in their entirety and took the leading share of beer-type drinks back from Kirin Brewery. In March 2023 Matsuyama Kazuo (松山一雄), who had worked at P&G among others and had been president of Sato Holdings, became president of the operating company Asahi Breweries — the first president from outside the company in 37 years, since Higuchi Hirotaro in 1986.
What Matsuyama, seeing the company from outside, found most out of joint was that meetings did not talk about the consumer but about product specifications, competitors' moves and price. On price the discussion ran that the cheaper the better, and it took time to get the company to share the concern that continuing a price war would damage brand value and turn the product into one that would not sell without special offers and giveaways. Under the change of direction set out by the previous president, Shiozawa Kenichi (塩澤賢一) — from volume to value — the company shifted to a form in which it does not chase sales volume but raises brand value and sells at a proper price. The targets of acquisition also widened from the mature markets of the developed world to emerging markets: in December 2025 it announced that it would acquire, for about $3.1B (¥465bn), the East African alcoholic-beverages business covering Kenya, Uganda and Tanzania from Diageo of the United Kingdom — its first entry into Africa.
The turning points, read in full: what was at stake, what was chosen and what the revenue did around it. The Japanese edition is the edition of record and carries the sourced dossier behind each decision — background, options weighed, outcome — linked under every decision.
Revenue (¥ bn) · net margin % · around FY1982
Key decision · 1982
Bringing in Sumitomo Bank's Murai Tsutomu and rebuilding Asahi Breweries through corporate identity (1982)
A reform that priced in results ripening after the term of office
The heart of this decision is that the rebuild began not with new products or new plant but with corporate culture and education — areas where results are hard to see. What showed in the numbers during Murai's four years in office went no further than the floor the Koku-Kire beer put under the share; the reversal of share ripened in the time of his successor, Higuchi. The apparently roundabout investment in a training centre, TQC and CI can be seen as having prepared, in advance, an organisation able to absorb a discontinuous decision like a total change of taste. That these four years priced in results ripening outside his own term says much about their character.
On the other hand, a structure that took four successive chiefs from the main bank sat next to the danger of thinning the chances of promotion for career employees. That the consecutive appointments of Murai and Higuchi worked nonetheless appears to be because the diagnosis — locating the cause of poor performance inside the organisation rather than in the market environment — was on target. What a chief executive brought in from outside chooses to change first: the answer Murai gave, change the culture first, leaves a question that still speaks to management today, when rebuilds led by outside talent are no longer unusual.
Betting the company on a total change of taste: the launch of Asahi Super Dry (1987)
Having little to lose, and a following wind from the times
At the centre of this decision is the paradox of having little to lose. It was precisely because the company had sunk to the brink of a share below ten per cent that it could throw away the taste of its existing mainstay and commit to a total change. Kirin, holding close to half the market, could not make the same bet against the palates of its existing customers — an asymmetry in which a high share binds a company's movements, visible too in the way the other brewers' dry imitations ended by doing nothing but favour Asahi, which had gone first. And the detachment with which Higuchi, a president out of banking, left the decision on taste not to the pride of the makers but to consumer tastings can be seen as possible only for a manager who had come from outside the industry.
At the same time, this success cannot be explained by innovation in taste alone. In an age of rising share prices, financial income from investment assets built up through share issues and bonds paid for the advertising; increased output and logistics prevented shortages; and buying back and scrapping old stock protected freshness. It was a combined campaign in which several mechanisms meshed at once, and for that very reason the stall of 1990 also reflected a new fragility — a dependence on a single brand and on financial-engineering income. The idea of going after the position of a staple brand in a mature market carried through to the large acquisitions in Europe and Australia some thirty years later, and this decision appears to form the prototype of today's Asahi Group.
Acquiring four European premium brewers, Peroni and Grolsch among them (2016)
An antitrust disposal that created a buyable staple
What is interesting about this acquisition is that it turned a by-product of another company's vast M&A into an opportunity. What AB InBev had to let go in the course of swallowing SABMiller, in order to get the deal past the competition authorities, was a set of premium brands long established in Europe. Staple brands with long histories do not normally come onto the market. Because of the antitrust remedy, they became available to buy as a package. Asahi stepped in to take them, acquiring the four western European companies.
It was a decision to reproduce, with Europe's staple brands, the thinking that had won a mature market at home with Super Dry. The consideration for the four western European companies was about $3.0B (¥329bn) — small beside the roughly $8.0B (¥900bn) spent on central and eastern Europe the following year, but it was the first move to establish a footing in Europe. The attempt to carry the domestic way of fighting — taking a position in a mature market and earning through premiumisation — straight overseas began in earnest here.
The ¥888.3bn purchase of SABMiller's central and eastern European beer business, making Europe a pillar (2016)
The weight of a contrarian bet on buying maturity
The distinguishing feature of this decision is that it deliberately chose a market that had finished growing rather than one that was growing. While many of its peers were betting on volume growth in emerging countries, Asahi bought whole, in developed countries where per-capita consumption had plateaued, brands that were already staples. The experience of Super Dry overturning share at home can be seen as having given the company the conviction that it is precisely in a settled market that position and premiumisation pay. The idea of taking in an established earnings base rather than starting a new business through M&A runs through this transaction as well.
That said, a strategy of buying mature markets presupposes the capacity to keep earning through price and efficiency, since volume will not rise quickly. The agility of settling successive European acquisitions on a $17.8B (¥2tn) scale in a little over two years was bold, but it was also a decision that took on enormous goodwill and interest-bearing debt. How far it can polish the staples it bought and keep drawing steady profit out of mature markets — the central and eastern European purchase was the move that would decide the aftermath of a bet to shift the source of growth to mature markets overseas.
The ¥1.2tn purchase of Australia's Carlton & United Breweries (2019)
The three poles bought outright, and the rival waiting there
The CUB acquisition is the closing piece of a series of overseas beer purchases that ran from the four western European companies in 2016 to the five central and eastern European countries in 2017. Rather than building a distribution network from nothing, Asahi bought the established local leader entire and put Super Dry onto its channels. This can be seen as a run of decisions that carried the company's own domestic thinking — the thinking behind taking in Calpis and Nikka — from Europe on to Australia. The phrase three-pole structure took on its outline as the result of these three vast acquisitions piling up.
What gives the deal its edge, though, is that what awaited the company at the end of the purchase was its long-standing domestic rival. Asahi and Kirin, which had contested the top place at home for a quarter of a century, each sought a way out overseas as they watched a maturing home market, and came face to face again in the same market, Australia. Whether a rematch fought in a distant southern hemisphere, while carrying interest-bearing debt swollen to some $18.3B (¥2tn) and goodwill of more than $12.8B (¥1.4tn), leads to growth commensurate with the vast sums committed appears to remain a question still to be seen through.
This English edition follows the Japanese one chapter by chapter. The Japanese edition remains the edition of record: it carries the source-by-source citations, the financial tables and the shareholder and executive records. 日本語版（詳細）— Asahi Group Holdings full history in Japanese →
Asahi Group Holdings, Ltd. — 有価証券報告書 (annual securities reports), and Asahi 100, the company history published for the centenary.
企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968), the Asahi Breweries entry.
Nikkei Business — 日経ビジネス: 4 Oct 1982 (interview with Murai Tsutomu); 15 Feb 1988 (interview with Higuchi Hirotaro); 1 Jan 1990, on what followed the Asahi miracle; 15 Jul 1996, on deregulation as a tailwind for Super Dry.
Nihon Keizai Shimbun — 日本経済新聞 (Nikkei Inc.): 1 Jan 1984; 13 Dec 2016, on the ¥900bn acquisition.
Nikkei Ryutsu Shimbun — 日経流通新聞: 20 Aug 1987, on advertising strategy; 6 Feb 1988, on the dry competition and the growth of the industry.