Distell

Distell is a manufacturer and seller of spirits, vintage wines, cider and finished drinks. The group is headquartered in Stellenbosch, South Africa.

History

2021: Heineken bought Distell for €2.2 billion

On November 15, 2021, Heineken announced the acquisition of Distell Group Holdings, a South African wine and spirits producer, for €2.2 billion. With this transaction, the buyer created a new regional group to compete with larger rival Anheuser-Busch InBev and alcohol giant Diageo.

The Dutch brewer made an offer of $11.85 per share, which was recommended by Distell's board of directors, according to the statement. Heineken will also be looking for an opportunity to buy a controlling stake in Namibia Breweries, a regional partner. This step will lead to the creation of Heineken with a controlling stake and a total value of about €4 billion, the company said. Heineken will produce brewer's branded lager and Namibian Windhoek, as well as Distell's main products, such as Klipdrift brandy and Savanna cider, and a number of wines for export.

Heineken acquired Distell for €2.2 billion

We are very happy to combine three strong enterprises to create a regional champion in beverage production, ideally positioned to take advantage of significant growth opportunities in South Africa, said Heineken Chief Executive Officer Dolf van den Brink.

The deal will allow van den Brink, who became CEO in June 2020, to accelerate the implementation of the strategy of his predecessor Jean-Francois van Boxmere, who sought to seize growth opportunities on the continent by investing hundreds of millions of euros in promising markets such as Kot -d, Nigeria and South Africa. Heineken also seeks to counter the decline in beer sales in Asia. The purchase is expected to increase profit in the first year after the completion of the deal, Heineken said. Remgro, the investment company of South African billionaire Johann Rupert, said it would vote for the deal.

Upon completion of the transaction, Heineken will combine the purchased assets into a new holding company without listing. Due to the dry law, which was introduced in South Africa in connection with the COVID-19 pandemic four times, the share of illegal products increased to 22% of consumption. Now the illegal market in volume exceeds the cider and wine markets combined, in terms of absolute alcohol - 665.4 thousand hectoliters against 627.7 thousand hectoliters. However, Heineken considers South Africa one of its most effective markets.^[1]

Notes