Heineken takes stake in whisky maker Deanston in €2.2bn deal
Heineken is to take a stake in 236-year-old Scotch whisky brand Deanston as part of a deal worth €2.2bn (£1.7bn).
The mega-brewer is buying Stellenbosch-headquartered Distell in a deal that will hand it a minority share of Deanston, one of the largest Highland distilleries with roots dating back to a 1785 cotton mill.
Heineken will take over Distell's beer and wine operation as part of the transaction, while its whisky division - which includes Deanston - is to be split off and owned jointly by the Dutch drinks company and the South African investment business Remgro.
Separately, Heineken will take a majority stake in Namibia Breweries, another regional player, and combine the two businesses in a bid to dominate the market in southern Africa.
Heineken, which also owns Birra Moretti, Amstel and Tiger beer, will control an entity worth about €4bn on the back of the two deals, allowing it to compete more effectively with rivals such as AB InBev and Diageo overseas.
Distell is Africa's leading producer of cider, wine and spirits. Its staples include Klipdrift brandy and Savanna cider as well as Deanston.
The whisky brand has a production capacity of 3m litres a year at its distillery near Loch Lomond and sells its 12-year-old single malt for around £40.
Deanston ceased production in 1982 for eight years after a downturn in the whisky industry before it was purchased by Burn Stewart Distillers in 1990. This business was in turn sold to Distell in 2013 for £160m.
Dolf van den Brink, chief executive of Heineken, said: "[Distell] is a very well managed, successful business that had a lot of momentum going into this deal.”
The acquisition still requires shareholder approval. It is expected to boost earnings in the first year after completion, Heineken said.
The move comes a few years after AB InBev bought Castle Lite and Hansa maker South African Breweries, the country’s largest beermaker, as part of its megadeal for SABMiller.
Last year Heineken announced plans to slash its workforce by a fifth after profits plunged following the widespread closure of pubs and bars during the pandemic.
Distell shares fell 8.3pc to 167.38 rand (£8.1), having closed on Friday above the offer price at 182.59 rand – Heineken made an offer of 180 rand a share.
