South Africa: Competition Tribunal approves Diageo’s purchase of remaining 50% in Brandhouse Beverages

South Africa's Competition Tribunal has approved Diageo’s purchase of the 50 percent stake it did not already own in local firm Brandhouse Beverages from Heineken, iNVEZZ reported on November 26.

Earlier this year, Diageo and the Dutch brewer ended their distribution joint venture in South Africa, basing the decision on their belief that the respective businesses would fare better alone.

The two drinks companies said that they would call time on the partnership three years earlier than planned, underscoring divergent interests with the spirits and beer categories having performed very differently in recent years.

As part of the deal, Diageo agreed to sell its 25 percent equity stake in South Africa’s Sedibeng brewery to Namibia Breweries and its 15 percent equity stake in Namibia Breweries and 42.25 percent equity stake in Diageo Heineken Drinks, to Heineken. In return, Diageo agreed to acquire the remaining shares it does not already own in Brandhouse Beverages – the joint venture established in 2004 between the drinks giant, Heineken International and Namibia Breweries. The venture was established to sell Diageo’s spirit, RTD, cider and Guinness brands alongside the two other companies’ beer portfolio. On November 25, the Competition Tribunal approved the move on condition that it does not lead to any net reduction of jobs in South Africa.

26 November, 2015