Zimbabwe’s largest brewer, Delta Corporation, has announced plans to buy South Africa’s United National Breweries. The move sees Delta (40% owned by Anheuser-Busch Inbev) fully acquire the Diageo owned sorghum beer company.
Delta Corporation has continued its moves to diversify outside Zimbabwe. The leading Zimbabwean brewer, which acquired a 70% stake in Natbrew Zambia in January 2018, has sought to establish itself as a regional leader at the value end of the sector with the acquisition of South Africa’s United National Breweries (UNB). The transaction, which is subject to regulatory approval, is expected to close in the second half of the 2019 Financial Year.
In May 2018 Delta Corporation posted a US$88m after tax profit, up 27%, in the year to March 2018 (FY18), driven by strong demand. Revenues increased by 18% growth to US$572.2m. Lager volumes increased by 27% year on yeaer under while sparkling drinks volumes grew by 15%. Sorghum beer registered a growth of 9% by volume. Operating income rose 28% to US$104.7m. Earlier in December 2018, Delta Corporation announced plans to invest $21m in its Chibuku Super plant in Fairbridge, Bulawayo.
In South Africa, UNB owns the Chibuku, Leopard, Ijuba, Tlokwe and Joburg beer brands, and the traditional non-alcoholic maize-based energy drink, City Mageu. It is the leading sorghum beer brewer in South Africa. Diageo paid $36m to its partner Pestello Investments for full control of United National Breweries (UNB) in April 2015. It bought its original stake in UNB in January 2013, also for $36m. UNB has four breweries in South Africa.
This latest acquisition sees Anheuser-Busch Inbev cement its leading position in the beer market in Southern Africa. It also represents the latest divestment by Diageo from the beer market in Southern Africa, following a major restructure in 2015.
