Heineken, Diageo and Namibia Breweries extend relationship in South
Africa
Amsterdam, 7 March 2008 - Heineken N.V. announced today that
Heineken, Diageo and Namibia Breweries have reached agreement to form
a new joint venture for their combined beer, cider and RTD businesses
in South Africa. The new joint venture builds on the success of
brandhouse Beverages (Pty) Limited, the parties' current cost-sharing
joint venture in South Africa, which will continue to market and
distribute the parties' products in South Africa.
Heineken and Diageo will each own 42.25% of the new joint venture and
Namibia Breweries will own 15.5%. Each party will share in the
profits in proportion to their shareholding. The transaction is
conditional on the approval of the Competition Commission of South
Africa and is expected to complete on 31 March 2008.
In addition, Heineken and Diageo will form a second joint venture in
South Africa. The new entity will construct and operate a brewery in
Gauteng province, South Africa, and will be owned 75% by Heineken
with Diageo holding a 25% stake.
The brewery will have an initial capacity of 3 million hectolitres,
with the built-in flexibility to expand and will produce some of the
joint venture products, amongst others Heineken and Amstel brands.
Construction is expected to commence within three months and it is
anticipated that the brewery will be operational by the end of 2009.
Across both new ventures, Heineken's total net investment will be EUR
260 million. In the first two years, Diageo will invest £100 million
in both joint ventures. The investment meets Heineken's and Diageo's
return criteria.
Tom de Man, Heineken's Regional President Africa and the Middle East,
commented:
'With Africa now Heineken's fastest growing region, with the Heineken
brand growing 70% in South Africa and Amstel very clearly still a
favourite with South African consumers, there is no better time to
invest in growth. Our three businesses already have a strong,
successful partnership and I am excited about the new opportunities
that the combination of our brands and local brewing will create.'
Nick Blazquez, Managing Director of Diageo Africa, said: 'The
decision by Diageo, Heineken and Namibia Breweries to commit to a
closer relationship in South Africa reflects the success of
brandhouse and acknowledges the changing nature of the beverage
alcohol market in South Africa. We have already demonstrated that a
combined beverage alcohol distribution company can capitalise on the
growth opportunities in markets such as South Africa and the new
structure will enable us to realise further growth opportunities as a
result of the strong platform we will create together.'
Sven Thieme, NBL's chairman said: 'Following the successful
establishment of brandhouse in 2004, we have as a next step put our
brands together so as to maximise the mutual benefits of a joint
portfolio of premium products. For us this investment means that NBL
now has a tangible commercial interest in the sales and distribution
of all brands that are part of this new profit sharing venture.'
Editorial information:
Heineken N.V. is the most international brewer in the world. The
Heineken brand is sold in almost every country in the world and the
Company owns over 115 breweries in more than 65 countries. With a
Group beer volume of 139 million hectolitres Heineken ranks fourth in
the world beer market by volume. Heineken strives for an excellent
sustainable financial performance through marketing a portfolio of
strong local and international brands with the emphasis on the
Heineken brand, through a carefully selected combination of broad and
segment leadership positions and through a continuous focus on cost
control. In 2007, revenue amounted to EUR12.6 billion and Net Profit
before exceptional items and amortisation of brands amounted to
EUR1.1 billion. Heineken employs 54,000 people. Heineken N.V. and
Heineken Holding N.V. shares are listed on the Amsterdam stock
exchange. Prices for the ordinary shares may be accessed on Bloomberg
under the symbols HEIA NA and HEIO NA and on the Reuter Equities 2000
Service under HEIN.AS and HEIO.AS. Additional information is
available on Heineken's home page:
http://www.heinekeninternational.com.
Press enquiries
Véronique Schyns
Tel: +31 (0)20 52 39 355
veronique.schyns@heineken.com
Investor and analyst enquiries
Jan van de Merbel
Tel: +31 (0)20 52 39 590
investors@heineken.com
