Heineken Buys 3.2% of United Breweries for $138 Million

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Heineken NV increased its stake in India’s biggest beermaker to 42.1 percent, spending 8.72 billion rupees ($138 million) for additional shares in United Breweries Ltd.

The acquisition of a 3.2 percent holding from a unit of Diageo Plc reflects the Dutch brewer’s confidence in the long-term potential of India’s beer market, said a spokesman for Amsterdam-based Heineken, who declined to comment on whether the stake will be increased further.

Heineken is strengthening its ties with a business that has distributed its namesake beer in India since 2011. For Diageo’s United Spirits Ltd., the divestment of its remaining stake in the maker of Kingfisher beer forms part of a plan to monetize some non-core assets.

“Diageo’s exited a business it considers non-core and Heineken is buying into the significant potential of India,” said Javier Gonzalez Lastra, an analyst at Berenberg. “Everybody wins.”

United Breweries shares fell 1.1 percent to 1,013.7 rupees at the close of trading in Mumbai. The sale of 8.5 million United Breweries shares was done through a block trade on the National Stock Exchange at 1,030 rupees apiece, according to an exchange filing in Mumbai. Heineken fell 0.7 percent to 67.19 euros at 12:04 p.m. in Amsterdam.

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