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Sapporo Breweries Ltd. said Monday it will close two of its eight beer breweries by the end of 2003 as part of a restructuring program.

One of the breweries facing closure is the Sapporo city plant where it began operations in 1966.

The Sapporo plant will be shut down at the end of March 2003 while the other plant in question, located in Kawaguchi, Saitama Prefecture, will be closed the same year at the end of the summer high season, the company said.

The decision to close the two plants preludes an expected decline in demand for beer and “happoshu” low-malt beverages, Sapporo said.

The closures will result in annual cost cuts of some5 billion, the firm said.

The Sapporo plant started operating in May 1966, but its role as a production base in Hokkaido has receded since the opening of another plant in Eniwa, about 30 km southeast of Sapporo, in June 1989.

Following the closure of the Saitama plant, Sapporo will concentrate production in the Kanto region at its plants in Chiba and Shizuoka.

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