Heineken Partners with Chinese Brewer CR Beer to Propel Growth in World’s Largest Beer Market

Heineken has signed a long-term strategic partnership with China’s largest brewer China Resources Beer (CR Beer) in a bid to secure a share of the world’s largest beer market.

The $3.1bn deal, which was inked by the Dutch company and the CR Beer’s parent company China Resources Enterprises (CRE), sees Heineken take a 40% stake in CR Beer, while CRE takes a 0.9% stake in Heineken.

The partnership aims to boost Heineken’s brand in China, where it holds a 0.5% share of the beer market and lags behind rivals such as AB InBev and Carlsberg. CR Beer owns the Snow brand, which is one of China’s best-selling beers alongside AB InBev’s Harbin Beer and Chinese brand Tsingtao.

The deal, which includes Mainland China, Macau and Hong Kong, will see the two companies combine operations in China with CR Beer to license the Heineken brand long term.

The deal aims to leverage CR Beer’s distribution networks and local market knowledge to help Heineken grow its brands in the market, with CR Beer gaining access to Heineken’s premium brand portfolio and brand building knowledge as it looks to go international.

A statement from Heineken said the deal would help the companies “to win in the rapidly growing premium beer segment in China”.

China is currently the second largest premium beer market globally and is forecast to be the largest growth market over the next five years as demand for premium international brands continues to grow.

Jean-François van Boxmeer, chairman and chief executive officer of Heineken, said the partnership brought the Dutch company together with the “undisputed market leader in China”.

“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,” said van Boxmeer.

Chen Lang, chairman of CRE, 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.”

Source: The Drum

  Alcohol, Beverage, China, China Resources Beer, China Resources Enterprises, CR Beer, CRE, Heineken, Marketing