Heineken NV, the Dutch brewing company, is set to create a regional alcoholic beverage giant worth about €4bn (£3.4bn) by integrating the businesses in Southern Africa of Distell Group Holdings Ltd, Namibia Breweries Ltd (NBL) and Ohlthaver & List Group of Companies (O&L).
On completion of a number of transactions, Heineken’s total investment in the new company will be about €2.5bn in return for a 65% stake, with the remainder held by Distell.
It made a recommended offer for Distell, which values the businesses to be acquired at about €2.2bn. Distell is Africa’s leading producer of spirits, wines, ciders and ready-to-drinks (RTDs) and the world's second-biggest cider producer.
It also plans to acquire NBL’s 25% shareholding in Heineken South Africa (HSA), which values the whole of HSA at about €1.5bn. Heineken will also buy O&L’s 50.01% interest in NBL Investment Holdings, the controlling shareholder with a 59.4% stake in NBL, adding to the 49.99% interest it already has in the holding company. NBL, the beer market leader in Namibia, is valued at about €400mln.
Heineken will contribute these acquired assets plus the 75% stake in HSA that it already holds into an unlisted public holding company.
“We are very excited to bring together three strong businesses to create a regional beverage champion, perfectly positioned to capture significant growth opportunities in Southern Africa,” said Heineken chief executive and chairman Dolf van den Brink.
The transaction is subject to regulatory and shareholder approval. Expressions of support for the transaction have been received from shareholders representing about 56% of the votes of Distell and about 68% of the votes of minority shareholders of NBL.
If regulatory and shareholder approvals are successfully obtained, the transaction is expected to complete in 2022, said Heineken.