Extending gains from fruit production to CIS markets -- $500,000 investment in an established
domestic brand name equips it with modern extraction and carbonation lines for adding natural
flavor from ethers and essential oils. The makers of Kilikia Beer require German equipment to
modernize lines and export a new product line after establishing success with beer in Moscow
and Geneva.
Mr. Armand Pinarbasi, Managing Partner of Amyot Exco Armenia, will present the plans for
diversifying the non-alcoholic beverage line of products planned by Beer of Yerevan (also known
as the Yerevan Beer Company). Mr. Ashot Baghdasaryan, President of the Yerevan Beer
Company is available for meetings and discussions to provide any additional details, such as
product line pricing and technical issues, to interested investors or their representatives.
Company: Yerevan Beer JSC
Amount: $ 500,000
Tenor/Terms: Loan financing, 8-10% annual interest rate
Documentation:
License for beer and for soft drinks; Recent awards, medals and prizes for beer include: Golden
Medal (1997), Moscow, Russia; Bronze Medal (1998), Sochi, Russia; The best beer for the year
(1998), Moscow, Russia; The quality prize of ROA (1998), Yerevan; Golden Medal (1999)
Sochi, Russia; Golden Star (1999), Geneva, Switzerland.
Use of funds:
$120,000 Purchase of automatic regulating CO2 production equipment for soft-drink
carbonation and producing CO2 extractors. (Made in Germany)
$280,000 Working capital for raw material inventory.
Legal status of Company: Joint Stock Company
Local/strategic partners:
The main US distributors of the company are: Grand Beverage Co., Glendale, CA and Agency of
Trade Development between USA and Armenia, Los Angeles, CA
Distributor in Russia is Great Ararat Co. Ltd., Sochi.
Current operations:
Established in 1952 to produce beer, beverages and soft drinks, the company started to produce
dark beer in addition to light ones in 1997. Since 1998 it began producing soft drinks and then,
produced natural fruit juices starting in 2000.

Sales and marketing plan:
The strategy of the Yerevan Beer Company is to become the top producer of beer, soft drinks,
natural juices and nectars, as well as CO2 extractors in the region. The strategic sales policy of
the company targets concentrating on customers needs and implementing a strong promotional
campaign. It expects to use its established beer export and sales networks for promoting juices
and beverages.
Business Plan:
After raising a US$500,000 loan from a financial institution, the company will implement its
expansion project. Having recently established a new production line for natural fruit juices and
nectars, new equipment for packaging and production of natural juices will be purchased and
installed. Since the goal is to maximize capacity utilization, decrease production costs and
improve profitability, the business plan relies on first developing the domestic market share
substantially and then export production to USA and CIS markets and focusing on Moscow and
St. Petersburg.
Given higher production of natural juices and nectars after expansion, Yerevan Beer will
implement processing and production using CO2 extractors and ether oils from ground stones of
apricot and peach, as well as tarragon, Thumus serpyllum, Mentha piperita, Artemicia
Dracunculus, etc. These are expected to increase the quality help differentiate the product by
adding new flavors to enhance natural tastes of the carbonated beverages. This is expected to
ultimately expand exports further.

Competition:
The main domestic competitor in beer production is Kotayk Beer and in soft drink production-
Coca-Cola Bottlers Armenia (CCBA) and Hay Cola. For natural juice production — Noyan and
New Wave are brands that currently enjoy a medium sized share of the market. However, for
beverages produced with CO2 extraction, there are no competitors.
Foreign competition to Yerevan Beer Company could be from most companies importing beer,
soft drinks and natural juices to Armenia. In terms of planned exports to neighboring markets,
pricing will play a key role in competing with expensive internationally established companies
such as Philip Morris, Budweiser, etc. from US and all major European beer producers. These
include Coca-Cola Company, Pepsi Cola Company, etc. for soft drinks. Companies in Florida
and California for natural juices, and Dragoco Company in Austria as well as Lotier-Fis
Company in France for carbon-dioxide extractors.
Investment, Capital Cost and Financing Structure Proposed:
$1,452,045 Company equity (includes natural juice & nectar project)
$ 650,000 Loan already received
$ 500,000 Funding sought
$2,602,045 Total
The total investment required for successful implementation of the current project proposed by
Yerevan Beer JSC is $2,602,045. The funds will be used as follows:
$990,000 Purchase of juice packaging equipment from Combibloc Company
(US$650,000 arranged).
$302,500 Construction of new production premises and aseptic storing warehouse
$343,000 Equipment & machinery for processing fruit mash and extracting vitamins from
rose hip (includes transportation and installation costs).
$430,545 Procurement campaign of fruits of peach, apple, rose hip and sea buckthorn.
(for the first year starting from September).
$36,000 Packaging material from Combibloc Company-300,000 units.
$120,000 Procurement of automat regulating regime equipment for production of CO2 gas
for soft drink production, as well as production of CO2 extractors (from
Germany).
$280,000 Working capital for raw material.
Points of Contact:
Mr. Ashot Baghdasaryan
President
Kilikia Beer of Yerevan Company
Mr. Armand Pinarbasi
Managing Partner
Amyot Exco Armenia
Grant Thornton International
Vardanants 18 (Vernisage Entrance)
375010 Yerevan, Armenia
Tel: 374-1-58 63 73 / 52 24 01
Fax: 374-1-58 44 19
E-mail: amyot@arminco.com
Also in France:
104 avenue des Champs Elys es
75008 Paris — France
Tel: 331-44 70 30 03
Fax: 331-42 93 32 16
E-mail: erevan@club-internet.fr