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Heineken, Diageo buy Interbrew African stake

16-Apr-2003

Belgian brewing giant Interbrew has sold its minority stake in Namibia Breweries to rival groups Heineken and Diageo, netting €31 million in the process.

Interbrew acquired the 28.9 per cent direct and indirect stake in Namibia Breweries in February 2002, as part of its acquisition of German brewer Beck & Co. Namibia Breweries is the sole brewer in its country, with a volume of 1.2 million hl, and will continue to brew Beck's for the Namibian and South African markets for another 10 years under a new licence agreement with the Belgian company.

 

"Southern Africa is not part of Interbrew's current strategic geographic focus. However, we look forward to continuing our relationship with Namibia Breweries through the licence agreement," said John F. Brock, CEO of Interbrew .

 

Heineken and Diageo have created a 50/50 joint venture to control the 28.9 per cent stake in Namibia Breweries, which will now begin to distribute Heineken beer, imported from Europe, from 1 May 2003.

 

"For Heineken, the distribution network of Namibia Breweries offers not only great opportunities in the Namibian beer market but also in South Africa, where Heineken recently terminated its licensing agreement with SAB. Heineken can thus accelerate its growth in the South African beer market," the Dutch brewer said in a statement.

 

Heineken is also currently investigating the possibility of brewing its beer in Namibia. The African company has two breweries there: one in the capital, Windhoek, and one in the coastal town of Swakopmund. Heineken said that production capacity at the company could be increased to around 2 million hl with a minimal capital investment.

 

Namibia Breweries' main beer brands are Windhoek Lager, Windhoek Light and Tafel Lager. Other beer brands include Windhoek Special Lager, Windhoek Export, Das Pilsener, Urbock and a beer shandy called Club Shandy, while Beck's and Guinness are brewed under licence and marketed through Namibia Breweries' well-established sales and distribution networks in Namibia and South Africa.

 

Export of Namibia Breweries' beers and soft drinks is playing an important role with more than 50 per cent of production finding its way to 22 countries outside Namibia, Heineken said.

 

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