LQU Quilmes Ind Quinsa

LUXEMBOURG, July 26 /PRNewswire-FirstCall/ -- Quilmes Industrial (Quinsa), Societe Anonyme (NYSE:LQU) ("Quinsa") announced today that its filing of the 20-F of the year ended December 31, 2006 will be delayed. Quinsa's independent auditors, PRICE WATERHOUSE & Co. S.R.L., ("Pwc"), were not able to complete the audit of the U.S. GAAP reconciliation of the financial information of Quinsa and its subsidiaries in time to enable Quinsa to make the filing deadline due to the delay in the availability of certain accounting information necessary to conduct such audit and due to a decision by Quinsa to restate, in one respect, the US GAAP reconciliation of its financial statements for the year ended December 31, 2005. During 2006, Companhia de Bebidas das Americas - AmBev ("AmBev") acquired control of Quinsa. AmBev's acquisition of control requires that certain accounting adjustments be made for purposes of Quinsa's US GAAP financial reporting for the year ended December 31, 2006 and the information necessary to enable management to make these adjustments and to enable Pwc to audit these adjustments was delayed. These adjustments do not affect Quinsa's financial reporting under IFRS. During 2005, Quinsa purchased from its shareholder Beverage Associates Corp. ("BAC") all of the shares that BAC owed in Quinsa's subsidiary Quilmes International (Bermuda) Ltd. ("QIB") for an aggregate purchase price of $110 million. Based on advice from Pwc, Quinsa accounted for this transaction as the acquisition of a minority interest and accordingly treated the difference between the purchase price paid for the QIB shares and the accounting book value of those shares in the hands of BAC as a dividend and reduced shareholders equity by the same amount. The Staff of the Securities and Exchange Commission has disagreed with this accounting treatment and has requested that Quinsa restate the U.S. GAAP reconciliation of its 2005 financial statements to revise the accounting treatment for this transaction. Quinsa has agreed to the request made by the Staff. As a result of this restatement, Quinsa's stockholder's equity for the year ended December 31, 2005 will increase by approximately $70 million. The restatement will not have any effect on Quinsa's income statement for 2005 and does not affect Quinsa's financial reporting under IFRS. Quinsa will file its Form 20-F for 2006 as soon as the accounting and audit work described above is complete. Quinsa currently expects this to occur within the next [30] days. ABOUT QUINSA Quinsa is a Luxembourg-based holding company that controls 93% of Quilmes International (Bermuda) ("QIB"). The remaining stake is held by Companhia de Bebidas das Americas - AmBev ("AmBev"). Quinsa, through QIB, controls beverage and malting businesses in five Latin American countries. Its beer brands are strong market leaders in Argentina, Bolivia, Paraguay and Uruguay and have a presence in Chile. Further, the Company has entered into license and distribution agreements to produce and sell in Argentina, Bolivia, Chile, Paraguay and Uruguay AmBev and InBev brands. Similarly, under the agreements AmBev may produce and distribute Quinsa's brands in Brazil. The Company also has bottling and franchise agreements with PepsiCo, and thus accounts for 100% of PepsiCo beverage sales in both Argentina and Uruguay. Quinsa's Class A and Class B shares are listed on the Luxembourg Stock Exchange (Reuters codes: QUIN.LU and QUINp.LU). Quinsa's American Depositary Shares, representing the Company's B shares, are listed on the New York Stock Exchange (NYSE:LQU). Quinsa's web address: http://www.quinsa.com/. DATASOURCE: Quilmes Industrial (Quinsa) S.A. CONTACT: Francis Cressall, Quilmes Industrial (Quinsa) S.A., +011-5411-4349-1846 Web site: http://www.quinsa.com/

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