Heineken in Namibian beer grab

DUTCH brewing giant Heineken NV has entered into an agreement with the Ohlthaver & List (O&L) group to buy its stake in Namibia Breweries Limited (NBL), valued at about N$3,5 billion.

How much Heineken NV is willing to pay for the stake is yet to be disclosed.

This deal is part of Heinekens desire to dominate the southern African alcohol market, where the Amsterdam-headquartered brewing company is seeking to buy up the South African Distell Group Holdings Limited and the entire shareholdings in NBL.

The end result is to integrate their respective and relevant businesses in southern Africa “into one enlarged company”, Heineken said in a press release yesterday.

The expanded company would be called Sunside Acquisitions Proprietary Limited.

FULL OWNERSHIP

Distell is reportedly Africas leading producer and marketer of ciders, flavoured alcoholic beverages, wines, and spirits.

Its popular drinks include Savanna, Hunters, 4th Street wines, and Amarula Cream Liqueur, among others.

NBL is the market leader for beer in Namibia, and the maker of Windhoek Lager and Windhoek Draught among others.

Heineken, by controlling Distell and NBL, said it would strengthen its second position in South Africa, control the market leader in Namibia, and further strengthen and optimise its footprint across southern Africa to accelerate growth, the company said.

At the moment, NBL is owned by the O&L group (50,01%) and Heineken International BV (49,99%).

Heineken now wants full ownership, taking about N$7,1 billion from the well-to-do German familys books.

NBL and Heineken have been sharing a business bed for long.

O&L has been paying millions in management and royalty fees to Heineken BV for years, and for the 2021 financial year, this amount stood at N$7,8 million.

NBL has a 25% stake in Heineken SA (HSA), one of its troublesome assets that has returned losses over the past few years.

Heineken wants to buy this back too, and has offered NBL a whopping N$5,5 billion.

This proposal would have the Government Institutions Pension Fund (GIPF) as a shareholder walking away with at least N$789,3 million, while NBL chairman Sven Thieme would get a N$1,7 million cut through his 66 000 shares

Other directors would pocket the following: Vetumbuavi Mungunda N$75 000, Peter Grüttemeyer N$2,6 million, Hans-Bruno Gerdes N$1,8 million, and Günther Hanke N$230 400.

NBLs other shareholders would also receive some good change through a special dividend at N$26,35 per share.

UNLISTED NEW ENTITY

The new entity Heineken wants to create would be a marriage of Distell, NBL, and Heineken SA, and is expected to have a total valuation of approximately N$70 billion.

The entity would reportedly be unlisted.

The sale, if approved, would, however, still leave NBL listed on the Namibian Stock Exchange, and the GIPF and others would retain their shareholding in the company – only now they would be rubbing shoulders with Heineken alone, with O&L out of the picture.

“At completion, Heineken will contribute these acquired assets, plus its 75% directly owned shareholding in HSA, and certain other fully owned export operations in Africa, into an unlisted public holding company,” read the press release.

Heineken would reportedly own a minimum of 65% of Sunside, with the remainder held by Distell shareholders, who could be electing to reinvest.

Commenting on the deal, Heinekens chief executive officer and chairman, Dolf van den Brink, yesterday said Heinken has the opportunity to create a regional beverage champion, perfectly positioned to capture significant growth opportunities in southern Africa.

Thieme as O&L chairperson yesterday said the deal was a necessity for NBL to unleash its full potential.

“We are confident that Heineken is best placed to do just that,” he said.

Distell chief executive officer Richard Rushton said the Heineken partnership has the potential to leverage the strength of Heinekens global footprint with Distells leading brands to create a formidable, diverse beverage company for Africa.