Diageo also sold 49.99 per cent of GAPL Pte Ltd., which distributes stout beer in Singapore and Malaysia, handing Heineken full ownership.
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Apart from GAPL, Diageo also sold its 57.9% stake in Jamaican brewer Desnoes & Geddes Ltd (D&G) to Heineken for a combined US$780.5 million (RM3.28 billion).
Heineken will maintain 73.3% of a stake in Desnoes & Geddes following the deal, and it will offer an amount to purchase the remainder of shares it does not own already.
Diageo PLC on Wednesday said it has completed an agreement with Dutch brewer Heineken under which Diageo will sell its stakes in two business and buy Heineken’s stake in another.
Phil Carroll, an analyst at Shore Capital, described it as…
It will acquire as well, the distribution and licensing rights to Dragon and Red Stripe in the USA, Canada and Britain from Diageo starting in January, said Heineken.
Finally Diageo has bought Heineken’s 20% stake in Guinness Ghana Breweries Limited (GGBL), a company listed on the Ghanaian Stock Exchange, taking its stake to 72.4%. GGBL will continue to be Heineken’s exclusive distributor in Ghana. The transaction will result in an exceptional profit on disposal of approximately £440 million after tax.
The net cash receivable by Diageo for the deals will be USD780.5 million, which will be settled immediately.
“Having greater commercial control in the important regions of Southeast Asia and the Caribbean will allow us to maximise the strong potential of our brands in these growth markets”, its chief executive officer Jean-François van Boxmeer said in the statement.
The company generates one-fifth of its revenue from beer, mostly the Guinness brand, which is growing more slowly than spirits.
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“Pursuant to this transaction, GAB will continue to benefit from access to both Heineken’s and Diageo’s global brand portfolios”, it added.
