Heineken Acquires Drinks Union in Czech Republic

25/03/08 Heineken N.V. announced that it will acquire Drinks Union in the Czech Republic. The transaction will strengthen Heineken's number 3 position in the market, and gives the company a market share of 12% and a total domestic volume of more than 1.9 million hectolitres.

The cost of the transaction, which will be funded from existingcredit facilities, has not been disclosed. The deal is expected to be earnings enhancing in 2009 and value enhancing in 2012. The proposed acquisition will be submitted to the relevant competition authorities for approval and, subject to this, is expected to be completed by the second quarter of 2008.Drinks Union owns a total of four breweries, all located in North andEast Bohemia. Two of the breweries are located in Usti nad Labem, onein Louny and one in Kutna Hora.

The regional market positions are complementary to Heineken's existing positions in the Moravian and Prague regions. Drinks Union has a total production capacity of 0.9million hectolitres and employs 523 staff. The brand portfolio consists of the national brand Zlatopramen and the regional Breznak, Louny and Dacicky brands. 2007 sales volumes totaled 900,000 hectolitres including export and the company currently has a domestic market share of 4%.

Nico Nusmeier, Regional President, Central and Eastern Europe of Heineken N.V., said: "With this transaction we have significantly extended our reach and consolidated our position in a profitable beer market. Our geographic presence coupled with our strong, balanced portfolio of regional and national brands, will allow us to extract greater value from the considerable growth opportunities in the Czech market."

In the Czech Republic, one of Europe's reference beer markets,Heineken currently owns the Starobrno and Krusovice Breweries, with breweries in Brno, Znojmo (Moravia) and in Krusovice (Bohemia).Heineken's existing brand portfolio includes Starobrno, Hostan, ZlatyBazant, Krusovice and Heineken.