By Andy Young

Heineken and Diageo have agreed a US$780m deal which sees the Dutch brewer take a controlling interest in Jamaican brewery Desnoes & Geddes.

The deal also sees Heineken acquire Diageo’s 49.99 per cent stake in GAPL Pte Limited, which produces Tiger and Anchor beers, and sell its 20 per cent stake in Guinness Ghana Breweries Limited.

Desnoes & Geddes brews Red Stripe and Dragon, and Heineken now owns 73.3 per cent of the company, Heineken will also make an offer for the remaining shares.

The deal sees Diageo's international distribution rights for Red Stripe lager go to Heineken. In a statement Diageo said that the transaction will result "in an exceptional profit on disposal of approximately £440 million after tax".

Ivan Menezes, chief executive of Diageo, said: "The transaction we have announced today continues our proactive approach to our portfolio, enhancing our focus on the core to achieve Diageo’s performance ambition.  It provides a strong route to consumer for Guinness which will grow the brand in these markets. I am pleased that this transaction meets the clear strategic objectives of both Heineken and Diageo."

Heineken's CEO, Jean-Francois van Boxmeer, added: "Today’s transaction represents another important step towards ensuring that our portfolio of assets and participations is optimally structured to support our strategic agenda. Having greater commercial control in the important regions of South-East Asia and the Caribbean will allow us to maximise the strong potential of our brands in these growth markets. Our close collaboration with Diageo has been very productive over the years and I would like to thank them for their valued partnership."

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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