Heineken increases focus on Southeast Asia with purchase of Carlsberg brewery in Vietnam

By Mary Ellen Shoup contact

- Last updated on GMT

Heinkene sees Vietnam as a strategic market opportunity because of its growing young population in metro areas where its outdoor cafe and bar scene is thriving.
Heinkene sees Vietnam as a strategic market opportunity because of its growing young population in metro areas where its outdoor cafe and bar scene is thriving.

Related tags: Beer, Ho chi minh, Vietnam

Heineken has acquired a brewery in Vietnam from competitor Carlsberg in order to capitalize on growth expected in the Southeast Asian beer market. 

The deal was completed in July but was announced this month, and coincides with the half-year reports of both Carlsberg and Heineken, which recorded six-month revenues of €4.2bn  ($4.7bn) and €10bn ($11.1bn) respectively.

Expanding production capacity

In a conference call to investors, Carlsberg CEO Cees ‘t Hart suggested that the sale of the brewery in the southern city of Vung Tau – 45 miles southeast of Ho Chi Minh City – would allow the Danish brewer to focus on its existing operations elsewhere in Vietnam.

“With regards to Vietnam, indeed, we focus on the territory where we are [in the north]. We have a footprint, which we would like to improve at the moment that the privatisation [of Habeco] is being implemented,”​ Hart said.

Despite the loss of its brewery in Vietman, Carlsberg still maintain a large presence in Vietnam with its stake in Hanoi Alcohol Beer & Beverage (Habeco).

The acquisition of the brewery in Vietnam will accommodate Heineken’s plan for expanding it production capacity.

"In Vietnam, beer volume, after a successful Vietnamese New Year, continued to grow double-digit in the second quarter,"​ Heineken said in a statement last month.

"The Tiger brand showed particularly strong momentum. Improved consumer confidence, combined with the success of our portfolio strategy and commercial execution, were the main drivers," the ​company continued.

Market opportunity in Southeast Asia

Vietnam is currently the third largest beer market in Asia with a population of nearly 90 million.

The country’s rising middle classes make it an attractive market for both local and foreign brewers. Beer production in Vietnam reached 3.4 billion liters in 2015, a 4.7% year-over-year increase, according to a report released by the Vietnam Beer Alcohol Beverage Commission (VBA).

The VBA also predicts that by 2020 annual beer production will reach between 4 to 4.25 billion liters and 8.3 to 9.2 liters of alcoholic beverages per year (including wine).

According to Euromonitor,  the beer market in Vietnam is less dominated by local brewers than other countries like Japan and Thailand where local brewers make up 90% of the beer volume compared to Vietnam where local brewers account for 63% of the total beer market, creating more market opportunity for foreign brewers. 

Related news

Show more

Follow us

Featured Events

View more

Products

View more

Webinars