BREWING GIANT Diageo is expected to unveil a wide-ranging restructuring of its Irish operations next week, which could include the closure of the famous St James's Gate brewery in Dublin and two other beermaking plants.
The St James's Gate site covers about 55 acres close to Dublin city centre and has been used to brew Guinness since 1759. It was once the largest brewery in the world.
Its closure would be a major blow to that area of the city, although Diageo is likely to retain a visitor centre on the site and possibly other functions. Its Guinness Storehouse attracts more than 900,000 visitors a year.
It is understood that Paul Walsh, Diageo's group chief executive, will travel to Dublin in the middle of next week to outline details of the group's long-running review of its Irish brewing operations.
Informed sources said it was poised to announce the closure of the St James's Gate facility along with breweries in Kilkenny and Dundalk.
Diageo intends to establish a new brewery on a greenfield site, possibly at Grange Castle near Clondalkin in southwest Dublin. This would involve a multimillion-euro investment.
Staff fear that the restructuring will lead to a large number of job cuts at the company, which employs about 800 staff in its brewing operations.
Diageo's plant in Dundalk makes Harp lager. In Kilkenny, its St Francis Abbey brewery occupies about 25 acres in the heart of the city and brews Smithwick's ale.
St James's Gate produces about 12 million kegs of Guinness a year. In 2004 Guinness closed its Park Royal brewery in London and shifted production to Dublin.
It is understood that Diageo feels that the site, which occupies two large plots of land south of the river Liffey, is no longer viable for brewing.
The decision has also been influenced by the determination of Irish Rail to tunnel under the brewery to build an interconnector between Heuston and Connolly train stations.
This would involve Irish Rail digging at the site for a number of years, disrupting Guinness's kegging activities.
Brewing could continue at St James's Gate for another two to three years before any move to a new plant.
The St James's Gate site would be expected to fetch a huge price for Diageo.
Previous reports have suggested that it could be worth up to €3 billion.
However, the global credit crunch, the recent decline in the Irish property market and the existence of a number of listed buildings on the site make that seem like a fanciful figure now.
