Distell Soon to Be Owned by Heineken, New Alcohol Entity Will Be Created

Distell Soon to Be Owned by Heineken, New Alcohol Entity Will Be Created

  • Heineken has proposed to buy Distell in an R38.4 million deal which will merge the company with other brands into a new alcohol group
  • The new group will be called Newco and will be worth an estimated €4 billion (euros) after its first year
  • South Africans are hoping that this merger will ensure stock of their favourite beverages, such as Savanna and Heineken

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Heineken has offered Distell an R38.4 million deal to take over the company in a plan to create two new alcohol companies that will include Klipdrift, Savannah and Windhoek, amongst other brands. This deal is still subject to the approval of shareholders.

The one company will be called Newco and will consist of ciders, spirits, wines, and ready-to-drink beverages currently owned by Distell, including Heineken, Windhoek and Tafel.

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Heineken is a Dutch company and the second-largest brewer in the world, following Anheuser-Busch InBev, News24 reports.

Distell, Heineken, liquor industry
Heineken has proposed an R38.4 million deal to buy Distell. Image: Chris Ratcliffe/Bloomberg via Getty Images.
Source: Getty Images

Details of the takeover and merger

NewCo will be worth an estimated €4 four billion after its first year and will focus on both the local market and exports.

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Dolf van den Brink, the CEO of Heineken, said that the company is looking forward to the creation of NewCo and working alongside the brands contained therein.

According to Business Tech, Distell's shares decreased by 5.1% last week but managed to trade at R182.59 a share, despite the asking price only being R180.

South Africa reacts to the proposed takeover

@CraftAfrica54 said:

"This deal makes no sense in the long-term from a South African jobs perspective, but we move."

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@Mahoota11 shared:

"Heineken about to restore Savanna's peak levels"

@VinnyMampa believes:

"I once told some friends I think 3months ago that the reason now that there’s shortage savanna bev us bcos of the battle between Heineken and Savanna bcos heineken quarts were loosing volumes due to savanna quarts bottles,then the battle began."

@EdStoddardZA said:

"SA's penchant for pandemic prohibition is a material risk to the booze business but there you go..."

Savanna production slowed down due to the global glass shortage

Previously, Briefly News reported that with summer steadily approaching and South Africans starting to gear up for the festive season, many people have been disappointed to discover that there is low stock of the popular cider, Savanna, in liquor stores with some outlets reporting that they will be sold out for the next few months.

Covid-19 has resulted in worldwide shipping delays affecting a variety of sectors and the liquor industry by creating a glass bottle shortage. However, global glass producers have stated that they believe the constraints will be temporary.

Savanna took to their social media platform to apologise to their consumers for the lack of stock in liquor stores and vowed that they were working to ensure that there would be enough in time for the festive period.

Source: Briefly News

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