Shareholder Arnhold and S. Bleichroeder Advisers, LLC Rejects Voluntary $67.07 Offer to Quinsa Minority Shareholders as Inadequate.

NEW YORK -- Arnhold and S. Bleichroeder Advisers, LLC today announced that it that it has sent the following letter to the Board of Directors of Quilmes Industrial (Quinsa) SA (NYSE ADSs: LQU):

February 13, 2007

The Board of Directors
Quilmes Industrial (Quinsa) SA
84, Grand-Rue
L-1660 Luxembourg

To the Members of the Board:

Our firm and funds that we advise are the holders of more than 666,700 American Depositary Shares ("ADSs"), of Quilmes Industrial (Quinsa) SA ("Quinsa"), equivalent to 1,333,400 Class B shares, or approximately 15.3% of the Class B shares not held by Companhia de Bebidas das Americas - AmBev ("AmBev"), or its affiliates. We are writing to inform you of our intention not to tender into the $67.07 voluntary offer by AmBev for the minority shares of Quinsa, which must receive, per the Offer Document, at least 3,939,387 of the Class B shares in order to be successful. We believe that the price offered by AmBev is inadequate and does not reflect Quinsa's fundamental value, future prospects, or recent valuations paid to acquire brewing assets. Moreover, we feel that the price offered was depressed by material conflicts of interest that undermined the process of representing the minority shareholders' interests.

Flawed Process

We cannot support an offer derived through a process that would not stand up to tests of fundamental fairness and good corporate governance, per international norms. This offer was tabled by AmBev, presented to a board appointed by AmBev, evaluated by Quinsa's executive management, and then by Citigroup Global Markets Inc. ("Citigroup"), for whom AmBev has been a significant client, including in prior purchases of Quinsa shares by AmBev. No independent board member or representative negotiated the price of the offer with AmBev. In fact, neither the board itself nor its agents negotiated the price of the offer with AmBev.

To meet standards of good governance and to convince minority shareholders that our interests were safeguarded, we believe that, at a minimum, the board should have formed a special committee, that the special committee should have hired independent financial and legal advisers, and that this committee should have made an attempt to negotiate the price of the offer. We realize that these minimums are not a requirement of Luxembourg law, per the Offer Document. However, the fact that such safeguards are the norm in jurisdictions with more developed takeover laws makes it clear to us that good governance and best practice have been disregarded in this case - and we therefore cannot support the present offer.

Change of Control

Control passed with the transaction announced in May, 2002 between AmBev and Beverages Associates (BAC) Corp. ("BAC"). As a result of the May 2002 agreement, BAC and AmBev entered into a put-call arrangement and an associated shareholders agreement that amounted to a change of control. Under the put-call agreement, BAC had the right to sell its remaining shares in Quinsa to AmBev in exchange for newly issued shares of AmBev. The put option could be exercised by BAC beginning in April, 2003 and in April of each year thereafter. Similarly, AmBev held a call option on BAC's Quinsa shares that could be exercised beginning in April, 2009 and each year thereafter.

The number of shares of AmBev that would be issued to BAC in the event that its put option was exercised was to be calculated pursuant to a valuation formula. This formula was based on Quinsa's and AmBev's earnings before interest, taxes, depreciation and amortization ("EBITDA"). AmBev's EBITDA multiple was to be based on its 90-day weighted average share price multiplied by AmBev's total shares outstanding plus consolidated net debt, divided by AmBev's EBITDA for the prior fiscal year. Quinsa's equity value was to be determined by applying AmBev's multiple to Quinsa's EBITDA for the prior fiscal year and subtracting Quinsa's net debt as reflected on its most recent balance sheet. (See Quilmes Industrial (Quinsa), SA, SEC Schedule 13D dated May 1, 2002.) This agreement was subsequently amended when BAC negotiated the sale of its remaining shares in Quilmes International (Bermuda) Ltd. ("QIB") to Quinsa in August 2005.

On April 13, 2006 AmBev issued a press release announcing that BAC had "agreed to sell its remaining shares in Quinsa to AmBev for a total purchase price of approximately US$1.2 billion, subject to certain adjustments, including dividends, and interest." It further stated that the transaction superseded the put and call options. The parties agreed that the purchase price would be paid in cash rather than in AmBev shares. The purchase price corresponded to a projected EBITDA multiple for Quinsa for the year ended December 31, 2006 of between 9.3 and 9.5x Quinsa's projected earnings for fiscal year 2006. The 2006 estimate was calculated based on AmBev's guidance for Quinsa's EBITDA growth issued previously on February 23, 2006 (up 8-10%).

The May 2002 agreement amounted to a change of control transaction. The pricing mechanism was set, and the ultimate avenue for sale of BAC's entire stake to AmBev was delineated. That agreement and the associated Quinsa Shareholders Agreement, as described in the May 1, 2002 Schedule 13D filed by AmBev necessitates the affirmative consent of AmBev for all actions pertaining to "operating and capital budgets, capital expenditures, material or multi-year contracts, business outside of beverages or South America, product pricing, operating targets, changes in senior management compensation, issuances and repurchases of shares, incurrence of debt or guarantees in excess of certain thresholds, granting of liens, changes in dividend policy, delisting of Quinsa, merger or sale of Quinsa or its significant subsidiaries, material asset sales or spin offs, material acquisitions, transactions with AmBev or the Quinsa's or AmBev's affiliates, change of external auditors, material changes in accounting principles, or policies, institution of proceedings outside of the ordinary course of business, changes in the charter or by-laws of Quinsa or its significant subsidiaries, filing for bankruptcy, liquidation or dissolution of Quinsa or its significant subsidiaries".

Consequently, the price agreed to in April 2006 for the balance of BAC's shares did not reflect a control premium. It was the negotiated price for raising AmBev's already controlling stake from 56.72% up to 91.18%. AmBev negotiated for a minority holding with a third party, namely BAC, and arrived at a presumably fair price for both parties, which amounted to 9.3 - 9.5x EBITDA. AmBev is now again attempting to acquire additional non-controlling shares - but from minority shareholders who, in our view, have neither been adequately represented, and nor permitted to negotiate - and at a value well below what it paid BAC.

Inadequate Value

In addition to representing a lower multiple of EBITDA than what was offered to BAC, we believe AmBev's current offer to minority shareholders fails to reflect fair value for Quinsa for the following reasons. First, the performance of the business has markedly improved. Almost one year after the April 2006 agreement with BAC, Quinsa's operations have improved dramatically. While Quinsa has not yet filed audited results for 2006, AmBev's new guidance issued on November 9, 2006 for Quinsa's EBITDA growth in 2006 (up 16 - 20%) is twice what they projected at this time last year, when BAC and AmBev agreed on the sale of BAC's remaining shares. Even that figure may ultimately prove to be low as Quinsa reported on August 14, 2006 that its EBITDA grew by 20% in the six months ended June 30, 2006. While Quinsa only reports its results twice per year, AmBev further reported in conjunction with its third quarter earnings release on November 9, 2006 that Quinsa's EBITDA increased by 31.9% for the three months ended September 30, 2006.

Second, the projections provided by Quinsa's management for future years which were included in the formal offer to minority shareholders did not include synergies and cost savings that are expected from the complete integration of Quinsa into AmBev. We believe these synergies and cost savings are likely to be significant. For example, one investment analyst has publicly estimated these benefits to total approximately US$68 million. We do not believe any capitalized value of the savings are represented in the present offer.

Third, BAC was bound by a put/call agreement entered into in 2002. Had they not sold their shares, beginning in 2009 AmBev would have had the right to buy the shares at a time of its own choosing based on the trailing results of the business. The minority shareholders are under no such restraint or obligation to sell their shares. Additionally, one may argue that given AmBev's control of the board of Quinsa, it has now moved to "call" shares from the minority shareholders, clearly at the time it deems most beneficial to AmBev.

Fourth, AmBev announced on February 1, 2007 that its Canadian subsidiary, Labatt had agreed to buy Lakeport Brewing Income Fund. Lakeport is a brewer based in the province of Ontario, Canada. The purchase price, including long-term debt and non-controlling interest, equates to about 13x 2006 estimated EBITDA according to Merrill Lynch. This represents approximately a 38% premium over the valuation currently offered to the minority shareholders of Quinsa, based on management's estimate of Quinsa's 2006 results.

The April 2006 BAC Transaction

Finally, we think AmBev should pay the same value, to minority shareholders that it paid in the April 2006 transaction with BAC that was negotiated presumably at arm's length by BAC and AmBev. AmBev has insisted that the offer to minority shareholders is fair because it is the same price paid to BAC. We believe this is disingenuous. The same price is not the same value. As noted above, that price is now almost a year old, and Quinsa's performance since has increased dramatically.

Simply applying the same formula that was used to calculate the price agreed to by BAC in April 2006 suggests the inadequacy of the current offer. Should the same multiple range (9.3 - 9.5x) be applied to the projected EBITDA of Quinsa for fiscal year 2007, the calculation would yield a quite different value than what is currently being offered.

Furthermore, we believe that an estimate of 2007 EBITDA should be based on an outside assessment. Oddly, the Citigroup investment analyst who regularly follows AmBev, and is in close communication with its management, recently (January 29, 2007) published an estimate of Quinsa's EBITDA for fiscal year 2007. His estimate of US$590 million stands in stark contrast to the US$456.6 million estimate provided by Quinsa management to Citigroup for use in providing its fairness opinion to shareholders.

Doing the math yields an interesting result:

Estimated Quinsa 2007 EBITDA          US$590 million    US$590 million
Less: Minority Interest                   42                42
                                          --                --
                                         548 million       548 million
BAC Transaction EBITDA multiple          x 9.3             x 9.5
                                         -----             -----
                                       5,096 million     5,206 million
Less: Quinsa's net debt at 12/31/07      117               117
                                         ---               ---
                                       4,979 million     5,089 million
Divided by ADS equivalents              54.2 million      54.2 million
                                        ----              ----
Value per ADS Equivalent            US$91.87 per ADS  US$93.89 per ADS

In our view the current offer does not reflect the long-term value of Quinsa to its owners because it does not fully consider the company's current performance and future prospects, nor does it reflect the current market valuation of AmBev or recent valuations paid to acquire brewing assets.

Failed Offer

In the event of a failed offer, we are more than happy to continue to hold our shares. In our view, Quinsa is an excellent business, with strong margins and good growth prospects. If the offer fails, we would like to take a more active stance towards our position to protect our rights as minority shareholders. Towards that goal, we would first request that you immediately release the 2006 full-year financial results. Second, we would ask you to name an independent party to the board of Quinsa to act on behalf of minority shareholders.

If the offer succeeds despite the fact that we have declined to tender, then we would look forward to seeking fair value of our shares from the Luxembourg authorities in a squeeze-out process, and, in particular, we would explore applying the minority shareholder protections of neighboring jurisdictions to a Luxembourg context.

Please feel free to contact us at any time to discuss these matters further.

Yours truly,

Arnhold and S. Bleichroeder Advisers, LLC

Jason B. Dahl
Steve Dixon
Jonathan Spitzer