Heineken says South African wine business is under review

Heineken says its South African wine business, including Nederburg and JC Le Roux, is under strategic review. The company is weighing wine's role in its portfolio while reporting growth in beer and ready-to-drink volumes.

Heineken acquired the wine brands through its €2.2 billion (R40.8 billion) Distell purchase. The transaction was agreed in 2021 and completed in 2023. The enlarged business experienced integration difficulties and market-share losses, with Heineken recording a €491 million impairment in 2023.

Heineken chief financial officer Harold van den Broek told analysts: “We are not making rash decisions on what to do, but we do have it under strategic review”.

The review concerns brands acquired during a substantial expansion of the company's southern African business. Heineken said more than 5,400 employees from Distell and Namibia Breweries joined the company when the transaction was completed.

Heineken reported double-digit growth in South African beer and ready-to-drink volumes in the third quarter, while wine remained under pressure. Those results place the wine review alongside stronger volumes elsewhere in its South African portfolio.

“We are really working very hard to bring volumes back into our business in South Africa”, van den Broek said.