Case study South Africa: Opportunity Knocks

Africa and the Middle East is Heineken’s fastest-growing region with both mature and developing beer markets contributing to growth. South Africa is one of the region’s largest beer market and has a fast-growing premium segment driven by economic growth and the emergence of an influential middle-class consumer.

To capitalise on this growth, in 2004, Heineken established a joint venture with Diageo and Namibia Breweries, to form the joint marketing and distribution company brandhouse. The business has grown rapidly alongside the growth of the Heineken brand.

To further build its presence in this important beer market, in 2007, Heineken regained control over the Amstel brand – the country’s leading premium beer – and immediately set about creating a new route to market. Initially, the brand would be brewed by traditional Amstel brewers in Europe, imported and sold through brandhouse. At the same time, Heineken announced its decision to invest in building a new brewery.

The brewery is a joint venture, 75 per cent owned by Heineken, 25 per cent by Diageo and is on schedule to be operational towards the end of 2009. The initial capacity of 3 million hectolitres has the built-in flexibility to expand as demand for the portfolio of beer brands increases.

The 80-hectare site, located south-east of Johannesburg, will comprise production buildings and cool cellars, as well as a bottling and distribution warehouse. When operational, the brewery will create around 225 permanent new jobs at all levels as well as a considerable number of outsourcing opportunities for local suppliers. This reflects our commitment to invest in and work with the communities and markets in which we operate.