Diagoe, Heineken swap assets worth $780.5 million

Diagoe Plc, world’s largest spirits maker and Heineken NV announced a deal Wednesday, valued at $780.5 million.

The deal would see Diagoe sell its 57.9 percent stake in a Jamaican brewery, Desnoes & Geddes (D&G), makers of Red Stripe and Dragon Stout to Heineken. The transaction would increase the Dutch brewer’s ownership of D&G from 15.4 percent to 73.3 percent.

The statement also said that “Heineken will in due course make a mandatory offer for all shares of D&G not already owned by Heineken.”

In addition, Diagoe agreed to sell its 49.99 percent stake in GAPL Pte Ltd, owner of GAB, a Malaysian brewer of such brands as Tiger, Anchor and Malta. The transfer of these assets would give Heineken 100 percent ownership of GAB Breweries.

“As majority owner, Heineken will be able to drive the investment and strategic direction of the operating companies in Jamaica and Malaysia,” the statement added.

In the same transaction, Heineken agreed to sell its 20 percent ownership in Guinness Ghana Breweries Limited to Diagoe. It would increase the UK spirits maker’s control of the brewer to 72.4 percent.

The Chief Executive of Diagoe, Ivan Menezes said, Wednesday’s transaction “provides a strong route to consumer for Guinness which will grow the brand in these markets.”

Diagoe said it would receive $780.5 million in cash for the deal and an extraordinary net profit of £440 million ($671 million). The spirit maker added it would use the money to pay down debt.

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