Dutch brewery giant Heineken N.V. has signed agreement with the holding company of China’s top selling Snow beer brand to create a partnership which will help Heineken gain direct route-to-market in China while providing Snow with exposures to the global market.
In a statement announced at the end of last week, Henineken said it will take a 40% stake in China Resources Beer (CR Beer), China’s biggest brewer by volume and owner of the Snow brand, for HK$24.35bn (€ 2.7bn).
At the same time, China Resources Enterprises (CRE), which owns CR Beer, will buy 5.2 million of Heineken shares for €464.63m, giving it a stake of 0.9% in the Dutch company.
Under the terms of the strategic partnership, Heineken China’s current operations will be combined with those of CR Beer. Heineken will be able to tap into CR Beer’s distribution network, which will provide the Heineken brand direct route-to-market in mainland China, Hong Kong and Macau.
For CR Beer, it can benefit from the Dutch brewer's global presence and marketing capabilities and take Snow and other its other brands global, to become the Chinese beers of choice.
“We very much look forward to joining forces with CRE and CR Beer, the undisputed market leader in China,” said Jean-François van Boxmeer, chairman and CEO of Heineken.
“We believe that our strong Heineken brand and marketing capabilities, combined with CR Beer’s deep understanding of the local market, its scale and best-in-class distribution network will create a winning combination in the growing premium beer segment in China.”
Also commenting on the deal, CRE chairman Chen Lang said: “With Heineken’s long heritage and world-class iconic brand portfolio, along with our leading presence and deep understanding of China, we believe we can win together in this new era of the Chinese beer market, in which the premium segment will become increasingly important.
“In Heineken we have found the perfect partner to achieve our ambitions in China and – as an international partner – to support us in growing our business outside China.”
(the writer can be contacted at: DavidMa@thewinechronicle.com)