Interesting how in the space of one month three different publications: The Wall Street Journal, The Economist and Spain' El Pais (unfortunately, all by subscription only), devote articles to the family that created Kola Real. Kola Real was created by the Anano family in Peru during the worst times of the Shining Path guerrilla movement. The family had to flee its farm and moved to the city of Ayacucho, where they noted the lack of soft drinks as major bottlers of Coke and Pepsi, refused to send trucks over to their city. The family put together US$ 30,000 and started making a low cost soda named Kola Real which is now sold in Peru, Ecuador, Mexico and Venezuela. The Wall Street Journal estimates the company has revenues of US$ 300 million.

Kola Real's strategy is simply to undercut the competition by spending less on advertising and using a low budget approach to everything. In Mexico, Kola Real has forced Pepsi to cut prices twice and has accused Coke of ant-monopolistic tactics. The company is now getting ready to introduce other flavors to compete with the big multinational giants. Thus, Pepsi and Coke face a threat from where they least expected it.

In the article in El Pais, written by famous Peruvian writer Mario Vargas Losa, he closes by saying: "Not many have the success of the Ananos. But many more would have it if in Latin America we had more policies, that instead of discouraging or being hostile, would promote individual initiatives and would celebrate the success of a company, of an entrepreneur, as being the success of the whole of the citizens, with benefits towards all citizens, instead of assuming it with mistrust, rancor and envy....Now that here and there, the sadly remembered populism of tragic credentials is once again sprouting in Latin American lands -with Venezuela at the lead- it is worth spreading around the Continent the story of the Ananos family, as a reminder of what Latin America could be if, muck like those daring Ayacuchanos, they set themselves to do it."

(DOW JONES) DJN: =DJ INTERVIEW: Calcol Takes Over China Cola Joint Venture
DJN: =DJ INTERVIEW: Calcol Takes Over China Cola Joint Venture


By Owen Brown
Of DOW JONES NEWSWIRES

BEIJING (Dow Jones)--A top executive of Calcol Inc. (CLCL-OTC) said Friday the
Cleveland, Ohio-based investment firm has bought out its local joint venture
partner to become the first foreign firm to 100% own its soft drink
manufacturing business in China.
Calcol has acquired the 20% stake of its local partner China National Food
Industry Corp. in their Beijing-based joint venture concentrate
manufacturing and bottling plant, Calcol Chairman Norman Kaplan said.
Kaplan declined to reveal the cost of acquiring the 20% stake in Sanhe Meile
Soft Drinks Co., but said the buyout allows the company the opportunity to
boost its soft drink production in China.
"In the coming year we should be selling pretty widely in Beijing and we are
going to expand pretty rapidly after the WOFE (wholly owned foreign
enterprise) conversion is completed," he told Dow Jones Newswires in an
interview.
Kaplan expects a second bottling plant in Shenzhen across the border from
Hong Kong to be opened before the end of 2004, and a third plant in Shanghai
will follow in early 2005.
"We don't want to stretch ourselves too thin," Kaplan said. "So we are
concentrating on the three major cities."
All three plants will source their concentrate from Beijing which can supply
enough syrup each year to make 2 billion liters of soft drink, he said.
The addition of two new bottling plants in Shanghai and Shenzhen will also
allow Malibu brands to be sold in the fast-growing Yangtze and Pearl River
deltas, two of the booming regions of China.
Kaplan expects both plants to be up and running within 18 months, bringing
Sanhe Meihe's total soft drink production up to 25 million cases a year.

Nationwide Mkt For Malibu

Kaplan, who is also chairman of Sanhe Meile Soft Drinks, said the decision
to enter into a joint venture with the state-owned China National Food
Industry Corp. reflected the foreign investment laws at the time the
agreement was concluded in 1995.
Those laws required a minority local ownership in beverage manufacturing
plants in China.
But Kaplan said those investment laws have since been relaxed, allowing
foreign companies to own a 100% of a local soft drink business.
"To my knowledge the other soft drink companies are still joint ventures,"
Kaplan said. "And I think almost all of them (the joint ventures) have some
component of government ownership."
Sanhe Meile currently makes Malibu brand soft drinks almost exclusively for
the Beijing market.
But its expansion plans will allow Malibu to take on global names such as
Coca-Cola Co. (KO) and Pepsico Inc.'s (PEP) Pepsi Cola, as well as local
players such as Future Cola made by Hangzhou Wahaha Group Co. as an almost
nationally available brand.
But even with three bottling plants in China, the company's spending plans
are still pretty much small beer compared with the billion-dollar
investments by the global giants.

Rivals Pour In Billions

Coca-Cola has spent $1.1 billion in China since 1979 and expects to invest
an additional $150 million to build six more plants in the next five years
to add to its existing 28 bottling plants.
PepsiCo has invested $1 billion in China to set up 14 bottling plants and
more than 20 joint ventures across the country.
While Coca Cola and Pepsi are available throughout most parts of China,
sales of Malibu Cola, Malibu Diet Cola, Malibu Sunrise orange drink and
Malibu Surfs Up lemon-lime drink are limited to Beijing and the surrounding
areas such as Tianjin and Hebei province.
Cherry cola flavored Malibu Verry Cherry is due to be launched soon.
About 400 supermarket stores throughout Beijing and the surrounding region
already stock Malibu brand soft drinks, Kaplan said.
Sanhe Meile's production so far has been limited to 600 milliliter and 1.25
liter bottles.
The Beijing bottling plant is currently producing 6 million standard cases a
year, Kaplan said.
The opening this year of a canning line at the Beijing plant will add 7
million cases a year of canned soft drink to the existing bottled capacity,
he said. Shenzhen will also have a canning line to assist shipping the
product across the region to markets in Hong Kong and Macau.
"We are going to be putting out an awful lot of soda," Kaplan said.
Calcol Inc. is a vehicle for foreign investment in China and also has a
stake in a pharmaceutical company in Shenzhen, an industrial city in
southern China near Hong Kong.
Shares of Calcol Inc. trade on the over-the-counter Bulletin Board in the
U.S.

Company Web site: http://www.calcol.com

-By Owen Brown, Dow Jones Newswires

-Edited by John Viljoen

(END) Dow Jones Newswires
01-02-04 0500ET
*** end of story ***

(DOW JONES) DJN: DJ CORRECTION: Calcol Output At 75M Cases In 18 Mos, Not 25M
DJN: DJ CORRECTION: Calcol Output At 75M Cases In 18 Mos, Not 25M


Calcol Inc. Chairman Norman Kaplan expects both [additional] plants to be up and running within 18 months, bringing Sanhe Meihe's total soft drink production up to
75 million cases a year.

(In an item timed at 1001 GMT on Jan 2, 2004 the company's estimated total
output within 18 months was misstated.)

(DOW JONES) DJN: =DJ INTERVIEW: Calcol Takes Over China Cola Joint Venture
DJN: =DJ INTERVIEW: Calcol Takes Over China Cola Joint Venture


By Owen Brown
Of DOW JONES NEWSWIRES

BEIJING (Dow Jones)--A top executive of Calcol Inc. (CLCL-OTC) said Friday the
Cleveland, Ohio-based investment firm has bought out its local joint venture
partner to become the first foreign firm to 100% own its soft drink
manufacturing business in China.
Calcol has acquired the 20% stake of its local partner China National Food
Industry Corp. in their Beijing-based joint venture concentrate
manufacturing and bottling plant, Calcol Chairman Norman Kaplan said.
Kaplan declined to reveal the cost of acquiring the 20% stake in Sanhe Meile
Soft Drinks Co., but said the buyout allows the company the opportunity to
boost its soft drink production in China.
"In the coming year we should be selling pretty widely in Beijing and we are
going to expand pretty rapidly after the WOFE (wholly owned foreign
enterprise) conversion is completed," he told Dow Jones Newswires in an
interview.
Kaplan expects a second bottling plant in Shenzhen across the border from
Hong Kong to be opened before the end of 2004, and a third plant in Shanghai
will follow in early 2005.
"We don't want to stretch ourselves too thin," Kaplan said. "So we are
concentrating on the three major cities."
All three plants will source their concentrate from Beijing which can supply
enough syrup each year to make 2 billion liters of soft drink, he said.
The addition of two new bottling plants in Shanghai and Shenzhen will also
allow Malibu brands to be sold in the fast-growing Yangtze and Pearl River
deltas, two of the booming regions of China.
Kaplan expects both plants to be up and running within 18 months, bringing
Sanhe Meihe's total soft drink production up to 25 million cases a year.

Nationwide Mkt For Malibu

Kaplan, who is also chairman of Sanhe Meile Soft Drinks, said the decision
to enter into a joint venture with the state-owned China National Food
Industry Corp. reflected the foreign investment laws at the time the
agreement was concluded in 1995.
Those laws required a minority local ownership in beverage manufacturing
plants in China.
But Kaplan said those investment laws have since been relaxed, allowing
foreign companies to own a 100% of a local soft drink business.
"To my knowledge the other soft drink companies are still joint ventures,"
Kaplan said. "And I think almost all of them (the joint ventures) have some
component of government ownership."
Sanhe Meile currently makes Malibu brand soft drinks almost exclusively for
the Beijing market.
But its expansion plans will allow Malibu to take on global names such as
Coca-Cola Co. (KO) and Pepsico Inc.'s (PEP) Pepsi Cola, as well as local
players such as Future Cola made by Hangzhou Wahaha Group Co. as an almost
nationally available brand.
But even with three bottling plants in China, the company's spending plans
are still pretty much small beer compared with the billion-dollar
investments by the global giants.

Rivals Pour In Billions

Coca-Cola has spent $1.1 billion in China since 1979 and expects to invest
an additional $150 million to build six more plants in the next five years
to add to its existing 28 bottling plants.
PepsiCo has invested $1 billion in China to set up 14 bottling plants and
more than 20 joint ventures across the country.
While Coca Cola and Pepsi are available throughout most parts of China,
sales of Malibu Cola, Malibu Diet Cola, Malibu Sunrise orange drink and
Malibu Surfs Up lemon-lime drink are limited to Beijing and the surrounding
areas such as Tianjin and Hebei province.
Cherry cola flavored Malibu Verry Cherry is due to be launched soon.
About 400 supermarket stores throughout Beijing and the surrounding region
already stock Malibu brand soft drinks, Kaplan said.
Sanhe Meile's production so far has been limited to 600 milliliter and 1.25
liter bottles.
The Beijing bottling plant is currently producing 6 million standard cases a
year, Kaplan said.
The opening this year of a canning line at the Beijing plant will add 7
million cases a year of canned soft drink to the existing bottled capacity,
he said. Shenzhen will also have a canning line to assist shipping the
product across the region to markets in Hong Kong and Macau.
"We are going to be putting out an awful lot of soda," Kaplan said.
Calcol Inc. is a vehicle for foreign investment in China and also has a
stake in a pharmaceutical company in Shenzhen, an industrial city in
southern China near Hong Kong.
Shares of Calcol Inc. trade on the over-the-counter Bulletin Board in the
U.S.

Company Web site: http://www.calcol.com

-By Owen Brown, Dow Jones Newswires

-Edited by John Viljoen

(END) Dow Jones Newswires
01-02-04 0500ET
*** end of story ***

(DOW JONES) DJN: DJ CORRECTION: Calcol Output At 75M Cases In 18 Mos, Not 25M
DJN: DJ CORRECTION: Calcol Output At 75M Cases In 18 Mos, Not 25M


Calcol Inc. Chairman Norman Kaplan expects both [additional] plants to be up and running within 18 months, bringing Sanhe Meihe's total soft drink production up to
75 million cases a year.

(In an item timed at 1001 GMT on Jan 2, 2004 the company's estimated total
output within 18 months was misstated.)

Love can damage more than you can heal with drinking.

I am a hobo in the house of the lord.

If you're going through hell, keep going.Everybody is a star with the potentiality to shine in the infinite sky of eternity.

People are exponentially funnier when they're in rant mode.

Calcol expands with sale of stock
Beijing soft drink maker to add retailers
Saturday, June 05, 2004
Peter Krouse
Plain Dealer Reporter
Calcol Inc., which sells pop in China, announced Friday that it has sold $3 million in preferred and common stock.

Part of the proceeds was used to complete the buyout of a joint-venture partner's stake in Sanhe Meile Soft Drinks Co. of Beijing.

Most of the stock was preferred shares sold to British institutional investors, said Norman Kaplan, who lives in Shaker Heights and is chairman and president of Calcol, which is based in Shaker Heights and Beijing.

The joint-venture partner, China National Food Industry Group Corp., had 20 percent of Sanhe Meile.

Money from the stock sale also will go toward working capital, an upgrade to computerized accounting systems and personnel and insurance needs, the company said.

Calcol also said it will use proceeds to put soft drinks in about 3,000 additional retail stores in Beijing, Tianjin and Hebei Province.

The company, which has both a concentrate and bottling plant in Beijing, sells in about 500 stores in China, Kaplan said.

Calcol, whose shares are closely held and thinly traded, is listed publicly on the Pink Sheets, an over-the-counter market that requires limited financial reporting, Kaplan said. Calcol has about 1,000 shareholders, but only about 200 of those are "of record" - those who hold the stocks in their own name, as opposed to those whose brokers are the registered owners.

The stock last traded at 24 cents per share. The company has about 98 million common shares outstanding.

Kaplan said an additional 3.7 million preferred shares would turn into 23.5 million more common shares if converted.

He said that once Calcol's accounting systems adhere to the generally accepted accounting principles used in the United States, the company intends to seek a listing first on the Over-the-Counter Bulletin Board and then, if qualified, on the Nasdaq exchange. Both require greater financial reporting than Pink Sheets

For every action there is an equal and opposite government program.

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