Miller Time: CEO Bowlin Replaced

MILWAUKEE January 14, 2003; Carrie Antlfinger writing for the AP reported that the new owner of Miller Brewing Co. is replacing John Bowlin as the chief executive and president of the second largest U.S. brewery.

Norman Adami, chairman and managing director of South African Breweries operations in South Africa, was named Tuesday to replace Bowlin, who is resigning at the end of this month.

Bowlin, who has headed Miller since April 1999, stayed on after Philip Morris Cos. sold Miller in July for $3.6 billion in stock to London-based South African Breweries PLC.

The deal created the world's second-largest brewer behind Anheuser-Busch Cos., which makes Budweiser and Bud Light. The combined company took the name SABMiller.

But Miller's market share has continued to fall amid increasing competition from Anheuser-Busch Cos., No. 3 Adolph Coors Co. and other brewers.

Mike Brophy, a spokesman for Milwaukee-based Miller, said "our results in the recent past have been disappointing and this is a move we believe will help to move the company forward as far as business results." Its biggest brand is Miller Lite.

Resigning was a joint decision between Bowlin and the board, said Mike Hennick, another Miller spokesman.

Eric Shepard, executive editor at Beer Marketer's Insights, a newsletter that tracks the beer industry, estimated that Miller had 19 percent of the U.S. market in 2002, compared to 19.6 percent for 2001. He said Anheuser-Busch had 48.9 percent in 2002, up from 48.5 percent in 2001 and Coors had 10.9 percent, compared to 11 percent in 2001.

Sales in the beer industry were up about 1 percent to 1.5 percent in 2002, but Miller sales were down between 2 percent and 3 percent, Shepard said.

Miller's peak in the United States was 22.7 percent in 1994, he said.

"Over the last four years we have made a lot of progress and achieved some major improvements in the efficiency and competitiveness of Miller," Bowlin said in a news release. "I have been privileged to lead a very professional and talented management team and have every confidence that Miller will grow from strength to strength under Norman's leadership."

Adami, 48, joined South African Breweries in 1979 as a project officer, being promoted to a number of senior positions before becoming managing director in 1994.

In 1995, he was appointed to the main board of South African Breweries and in 2000 was appointed as chairman of its South African operations.

Analysts say the change wasn't a surprise, but it's hard to determine how the company will perform under Adami.

"This fellow is a stranger to this market," said Markh Rodman, owner and founder of Beverage Distribution Consultants of Swampscott, Mass. "He comes out of a market where Castle lager and the South African Brewery portfolio is overwhelmingly dominant and the company effectively controls its distribution."

Adami would help the company by consulting more with distributors and show he's committed to the distribution system, Rodman said.

"Norman Adami has got a lot of things that he's got to overcome before its too late. There's an old theory in the beer business ... once a company goes on a slide for three consecutive years it never recovers."

Adami was to relocate from Johannesburg to Milwaukee.

Graham Mackay, chief executive of SABMiller, said in the last 20 years Adami has developed and strengthened one of their largest and most successful operations.

Tony van Kralingen, currently managing director of the SABMiller subsidiary in the Czech Republic and owner of the Pilsner Urquell brand, will take over for Adami in South Africa.

Also announced Tuesday was the August retirement of Mike Simms, managing director of SABMiller Europe. He will be replaced by Alan Clark, currently managing director of Amalgamated Beverage Industries Ltd.