DUBLIN, Ireland (AP) -- Irish beer giant Guinness is going back to its country roots.
The company announced Thursday it will build its new flagship brewery west of Dublin in the town of Leixlip -- where Arthur Guinness began brewing the famed dark-brown stout in 1755, four years before moving operations to the capital.
The choice of Leixlip, though historically fitting, caught most observers by surprise. Recent Irish press speculation had focused on two other suburban Dublin locations.
The deal-clincher appeared to be that most of the brewery will be built on 50 acres (20.2 hectares) of land owned by the Guinness family. Another 23 acres (9.3 hectares) is being purchased from Kildare County Council.
"It is wonderful to know that the strong historical roots between the Guinness name and Leixlip will endure for generations to come," said Desmond Guinness, the brewer's descendant who lives in a nearby castle.
Terms of the land sale were not disclosed.
Confirmation of the Leixlip move represents the next step in a euro650 million (US$900 million) plan by Guinness owner Diageo PLC to prune costs and boost efficiencies at the Irish institution in the face of increased competition from Eastern Europe and Asia.
Diageo plans by 2013 to cut Guinness' brewing staff in Ireland by more than half, shut two breweries in the towns of Dundalk and Kilkenny, and reduce Guinness production at its Dublin brewery.
Future Guinness operations are to be focused on the Leixlip plant. It will take on production of several beer brands as well as the secret-recipe "essence" extract that Guinness ships to its nearly 50 stout breweries worldwide. The existing Dublin brewery will be responsible exclusively for brewing stout for the Irish and British markets.
The beer brands to be produced in Leixlip include Guinness' homegrown Smithwicks ale and Harp lager, as well as several foreign labels produced under license, including Carlsberg of Denmark and Budweiser of the United States.