The move allows Heineken to focus on DHN's beer portfolio. © Jasper Juinen/Heineken
Diageo has revealed plans to sell its minority stake in the South African and Namibian joint venture it launched seven years ago with Heineken, paving the way for it to target the region through wholly owned subsidiaries.
The alcohol producer said that it would sell its 42.25% stake in DHN Drinks – the joint venture that it has operated with Heineken and Namibia Breweries since 2008 – to the Dutch brewing giant, whose total share would rise as a consequence to 85%. Diageo will also sell the 25% stake it owns in the Sedibeng brewery in Gauteng, South Africa, as well as its 15% share in Namibia Breweries, to the Amsterdam-based brewer.
In all, the spirits company will receive £128m as part of the deal and will continue to operate in South Africa and Namibia through wholly owned subsidiaries.
Heineken claimed that the restructuring of its joint venture in South Africa will allow it to work more closely with Namibia Breweries and concentrate more precisely on its beer portfolio, which is reported to have lost market share in the country in recent months, according to the Wall Street Journal.
Diageo chief executive Ivan Menezes said: “We have worked very successfully with Heineken and NBL throughout our partnership, growing the beer business and establishing market leadership in spirits. From this leadership position we now believe that Diageo has the necessary scale to move to the next stage of growth for spirits, RTDs and our beer and cider portfolio in a focused, simplified ownership structure.”
Heineken CEO and chairman Jean-François van Boxmeer added: “For the past 11 years we have benefitted enormously from our close collaboration with Diageo and I would like to thank them for their valued partnership and wish them well for their future in the region. Our new structure allows us to focus solely on the beer category and strengthens our platform for continued growth. We look forward to working with our longstanding partner Namibia Breweries and are excited about our future prospects in this important part of the global beer market.”
© FoodBev Media Ltd 2024