LONDON (Reuters UK) - Diageo (DGE) plans to spend 520 million pounds in Ireland on a new brewery, renovate its central Dublin Guinness brewery and close two smaller sites at Kilkenny and Dundalk.
The London-based company said on Friday it will build the new brewery close to the Irish capital while its historic St James's Gate brewery in central Dublin will focus on brewing Guinness for Britain and Ireland.
The company added the release of land from the brewery sites has a value of around 400 million pounds.
The new brewery will produce Guinness to meet growing export demand and other beers for the Irish market. When the new site opens in 2013, production from Kilkenny and Dundalk will be transferred with net job losses of around 250.
Diageo will take a one-off charge of 120 million pounds for the restructuring in its accounts for the year to June 2008.
The St James's Gate brewery, which dates back to 1759, brews Guinness for Britain and Ireland and a number of export markets such as North America, and also exports Guinness-flavour extract to 42 other Guinness breweries around the world.
Sales of Guinness, which gets its trademark dark colour from dark roasted barley, fell 7 percent in Ireland and 3 percent in Britain during Diageo's last financial year to the end of June 2007, but worldwide sales grew 3 percent helped by growth in Africa, especially Nigeria, and also in Asia.
(Reporting by David Jones, Editing by Mark Potter and David Holmes)
