Kirin Holdings swoops for Schincariol

Kirin Holdings swoops for Schincariol

Kirin Holdings has emerged as the winner in the battle to take control of Brazil's second largest brewer, Schincariol, in a BRL3.95bn (US$2.5bn) deal.

Kirin has agreed to acquire a 50.45% stake in family-owned Schincariol, it said today (2 August). The Japanese brewer will buy all shares in the Brazilian brewer owned by Aleadri-Schinni, the company controlled by Alexandre and Adriano Schincariol.

SABMiller, Heineken and Diageo had initially showed interest in Schincariol, but have recently backed away, just-drinks understands. There have been reports of disagreements between Schincariol family members over how much of the company should be sold.

"This acquisition will further enhance Kirin's international integrated beverages group strategy," said Kirin, which, alongside rivals Asahi, Suntory and Sapporo, wants to reduce its reliance on Japan's sluggish drinks market. 

Brazil's beer market is set for continued strong growth, Kirin added. Schincariol represents one of the few remaining opportunities to get scale in a country where Anheuser-Busch InBev's AmBev business accounts for 70% of volume sales.

Schincariol's volume market share is around 11%, although its beers operate mainly at the lower end of the market. It has 13 production plants across the country and had net sales of BRL2.85bn in 2010, with net profits of BRL54m, according to Kirin.

Analysts at MF Global said today that the deal will aid the development of a premium beer segment in Brazil. "We feel Kirin will likely go some way towards premiumising Shincariol’s portfolio, though we note that the company has said it will keep current management in place," they said in a note.