Monday, 17 December, 2018

Heineken NV enters into agreement to acquire Brasil Kirin Holding SA

Heineken NV enters into agreement to acquire Brasil Kirin Holding SA Heineken NV enters into agreement to acquire Brasil Kirin Holding SA
Nellie Chapman | 14 February, 2017, 02:01

Kirin Holdings has agreed to sell its struggling Brazilian beer and soft drink business to Heineken International for about 77 billion yen ($676 million), the Japanese company said Monday.

Brasil Kirin operates 12 production facilities in the country, and produces the Schin and Devassa brands locally, as well as owning the speciality brands Baden Baden and Eisenbahn.

Heineken already has a presence in Brazil through its 2010 acquisition of the beer businesss of Mexican beverage company FEMSA. The soft drinks portfolio, includes the iconic Itubaína brand. Since then, HEINEKEN has increased its market share to c.10%, led by Heineken® in the outperforming premium segment.

HEINEKEN Brazil is in the process of reviewing its future route to market and will provide further detail when appropriate.

Heineken will pay about 660 million euro to acquire Kirin's entire Brazilian branch, which actually generates a 1.1 billion euro turnover.

Kirin Holdings is on the hunt for "investment opportunities" across South-East Asia as it posted a lift in full-year sales and a return to profit in 2016.

"Heineken expects to deliver significant cost synergies from the acquisition through production efficiencies, including logistics and brewery optimization, and through optimizing selling, general and administrative expenses." the Dutch brewery said in the press release.

Brazil's economy is set to enter a third year of recession in 2017, but Heineken said that the nation's beer market was attractive in the longer term, with a premium segment growing faster than the market as a whole.