Heineken to acquire Kirin's Brazilian unit for EUR664m
Dutch brewer Heineken has agreed to acquire Kirin's Brazilian business for €664m.
With the acquisition, Heineken is poised to become the second largest beer company in Brazil. According to Heineken, the Brazilian beer market is the third largest in the world, with 139 million hectolitres of beer produced in 2015.
The Dutch beer-maker says that the Brazilian beer market is highly attractive with its growing population and positive GDP outlook.
Apart from beer products, Brasil Kirin also has a soft drinks business which includes carbonated drinks, bottled water and other beverages and it accounts for about 2% market share.
Heineken expects that the transaction provide significant cost synergies, through production efficiencies including logistics, brewery optimisation and optimisation of selling, general and administrative expenditures.
The acquisition is subject to approval from Brazilian regulatory authorities and is expected in the first half of this year.
Brasil Kirin’s products are expected to complement Heineken’s existing products including Schin, Bavaria, Kaiser, Amstel and Devassa brands.
Brasil Kirin has also reported its financial results for the year ended 31st December, 2016. Its revenue for the period was $1.18bn, with an operating loss before amortisation of goodwill of about $84m.
HEINEKEN chairman & CEO Jean-Francois van Boxmeer said: "This transaction marks a step-change in scale in an exciting beer market, building on our success to date in the premium segment and strengthening our platform for future growth.
“It reiterates our commitment to the Brazilian market and confidence in our ability to generate attractive returns over the long-term across all segments of the market. I look forward to welcoming our new colleagues from Brasil Kirin into HEINEKEN and working with them to take the combined business forward."
Image: Heineken to acquire Brasil Kirin for €664m. Photo: Courtesy of Heineken N.V.