GLOBAL: Diageo acquires rights to Windhoek beer
Diageo plans to expand Windhoek beer across Africa after acquiring the global rights to produce and distribute the brand outside of its key South African and Namibian markets.
Diageo said today (26 February) that it has signed a 10-year licence deal with Namibia Breweries Ltd (NBL) for global rights to Windhoek, at no initial cost. Diageo holds a 14.6% stake in NBL.
The deal gives Diageo full rights to the brand outside of certain African markets, including South Africa, where Diageo distributes Windhoek via a joint venture with Heineken, and the beer's home market of Namibia.
A Diageo spokesperson told just-drinks today: "Windhoek will continue to be brewed in Namibia and we are initially looking introduce Windhoek to markets within Africa."
Several African countries have strongly developing beer consumption. Net sales of Diageo's Guinnesss brand rose by 25% across Africa in the six months ended 31 December, with Nigeria, Cameroon and parts of East Africa driving growth.
Windhoek is a premium beer produced according to Germany's beer purity law of 1516. Outside of South Africa and Namibia, the brand has grown volumes by 40% since 2006, according to Diageo.
Commenting on the financial terms of the deal today, a spokesperson for the drinks giant said: "The actual transfer of the rights of the production, marketing and distribution of Windhoek is at no extra cost, but we will be investing in the brand for marketing and distribution."
"The agreement will automatically roll over for consecutive periods of five years, unless it is terminated in accordance with its terms and/or amended."
Nick Blazquez, managing director of Diageo Africa, said: "This transaction deepens our commitment to total beverage alcohol and, along with a great partner in NBL, provides us with a strong addition to our range of premium brands in Africa and elsewhere."
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