Diageo, Heineken agree to beer assets swap in Ghana, Jamaica, Malaysia and Singapore
08 Oct 2015
1
Diageo and Heineken said on Wednesday that they had agreed to an asset swap related to their beer businesses in Ghana, Jamaica, Malaysia and Singapore.
Heineken intends to consolidate its beer businesses in Southeast Asia and the Caribbean, even as Diageo gains fuller control of Guinness Ghana Breweries Limited.
Heineken, the Dutch brewer of Amstel and Sol, will acquire Diageo's 57.87 per cent stake in Desnoes & Geddes Limited, the Jamaican brewer of Red Stripe and Dragon beers, gaining a 73.32 per cent stake in Desnoes & Geddes with the deal, and would make an offer for the remaining shares it did not already own.
Heineken will also acquire the licensing and distribution rights to Red Stripe and Dragon in the UK, Canada and the US from Diageo beginning in January, according to Heineken.
Further, with Heineken acquiring Diageo's 49.99-per cent stake in GAPL Pte Limited, it will get full ownership of the beer distributor in Malaysia and Singapore.
The sale of Diageo's 49.99 per cent stake in GAPL Pte Limited (GAPL) will give Heineken Heineken full ownership of GAPL.
The acquisition by Diageo of Heineken's 20-per cent shareholding in Guinness Ghana Breweries Limited (GGBL) will increase Diageo's shareholding in GGBL to 72.42 per cent.
The net cash consideration receivable for the transaction is $780.5 million (approximately £515 million). The transaction will result in an exceptional profit on disposal of approximately £440 million after tax. It is approximately 0.6 pence per share dilutive to EPS pre-exceptional in the first full year assuming a marginal interest rate of 2.5 per cent.
Ivan Menezes, chief executive of Diageo, said, ''The transaction we have announced today continues our proactive approach to our portfolio, enhancing our focus on the core to achieve Diageo's performance ambition. It provides a strong route to consumer for Guinness which will grow the brand in these markets. I am pleased that this transaction meets the clear strategic objectives of both Heineken and Diageo.''
GAPL holds 51-per cent of Guinness Anchor Berhad in Malaysia and is the licensee for Guinness and ABC Stout distribution for the Singapore market.
As part of these transactions Diageo will have long term distribution agreements with GAB for the brewing and distribution of Guinness and other Diageo beer brands in Malaysia and Singapore, and with D&G in relation to the brewing and distribution of Guinness and the distribution of spirits brands in Jamaica.
Diageo's international distribution rights to Red Stripe lager will transfer to Heineken. GGBL will continue to be Heineken's exclusive distributor in Ghana.
Heineken intends to consolidate its beer businesses in Southeast Asia and the Caribbean, even as Diageo gains fuller control of Guinness Ghana Breweries Limited.
Heineken, the Dutch brewer of Amstel and Sol, will acquire Diageo's 57.87 per cent stake in Desnoes & Geddes Limited, the Jamaican brewer of Red Stripe and Dragon beers, gaining a 73.32 per cent stake in Desnoes & Geddes with the deal, and would make an offer for the remaining shares it did not already own.
Heineken will also acquire the licensing and distribution rights to Red Stripe and Dragon in the UK, Canada and the US from Diageo beginning in January, according to Heineken.
Further, with Heineken acquiring Diageo's 49.99-per cent stake in GAPL Pte Limited, it will get full ownership of the beer distributor in Malaysia and Singapore.
The sale of Diageo's 49.99 per cent stake in GAPL Pte Limited (GAPL) will give Heineken Heineken full ownership of GAPL.
The acquisition by Diageo of Heineken's 20-per cent shareholding in Guinness Ghana Breweries Limited (GGBL) will increase Diageo's shareholding in GGBL to 72.42 per cent.
The net cash consideration receivable for the transaction is $780.5 million (approximately £515 million). The transaction will result in an exceptional profit on disposal of approximately £440 million after tax. It is approximately 0.6 pence per share dilutive to EPS pre-exceptional in the first full year assuming a marginal interest rate of 2.5 per cent.
Ivan Menezes, chief executive of Diageo, said, ''The transaction we have announced today continues our proactive approach to our portfolio, enhancing our focus on the core to achieve Diageo's performance ambition. It provides a strong route to consumer for Guinness which will grow the brand in these markets. I am pleased that this transaction meets the clear strategic objectives of both Heineken and Diageo.''
GAPL holds 51-per cent of Guinness Anchor Berhad in Malaysia and is the licensee for Guinness and ABC Stout distribution for the Singapore market.
As part of these transactions Diageo will have long term distribution agreements with GAB for the brewing and distribution of Guinness and other Diageo beer brands in Malaysia and Singapore, and with D&G in relation to the brewing and distribution of Guinness and the distribution of spirits brands in Jamaica.
Diageo's international distribution rights to Red Stripe lager will transfer to Heineken. GGBL will continue to be Heineken's exclusive distributor in Ghana.
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