Diageo Dissolves Heineken Venture to Go Solo in South Africa

Under the deal, Diageo is selling a 42% stake in DHN Drinks Ltd. and a 15% stake in Namibia Breweries to Heineken. Photographer: Adam Berry/Bloomberg

Diageo Plc said it’s dissolving a joint venture with Heineken NV in South Africa and neighboring Namibia three years earlier than planned so the world’s largest distiller can fully own its operations in those countries.

Diageo will receive about 128 million pounds ($199 million) from a series of transactions with Heineken and Namibia Breweries Ltd., the London-based company said Tuesday.

The Smirnoff vodka maker will buy out the Dutch brewer’s stake in Brandhouse, a sales and marketing entity, while Heineken will focus on beer, ending a joint venture with Diageo that began in 2004 to sell spirits, beer and cider in Africa.

“Diageo does not want to continue sharing profits with their joint venture partners as their spirits products are growing faster than beer,” De Wet Schutte, an analyst at Avior Capital Markets, said by phone.

Read more: Diageo Dissolves Heineken Venture to Go Solo in South Africa – Bloomberg Business

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