Heineken rumoured to take over Cerveceria Nacional Dominicana

Neither AB-InBev nor Heineken has confirmed it, but a persistent rumour in the Caribbean has it that the two brewers are in a USD 1.5 billion race to buy the Dominican Republic’s biggest brewer Cerveceria Nacional Dominicana (CND).

The brewer of Presidente beer, which is available in many other Caribbean islands, has allegedly been put up for sale by the nation’s biggest company, the tobacco manufacturer Grupo Leon Jimenes, which holds a majority stake in CND.

In 2010, CND had a turnover of USD 455 million and an EBITDA of 120 million according to company data.

Heineken already owns a 9.3 percent stake in CND. Acquiring a majority stake in CND would seem like a logical thing to do, given that in December last year Heineken increased its stake in neighbouring brewer Brasserie Nationale d’Haiti (Brana) to 95 percent from 22.5 percent.

CND currently has a 90 percent share of the beer market in the Dominican Republic, which has a population of around 10 million people. CND employs about 2,500 people and has a capacity of up to 5 million hl beer.

CND was founded in 1929 and started brewing the iconic brand Presidente in 1935. The brewer was bought by the local cigarette company Grupo Leon Jimenes in 1986.

In 2009, CND acquired Royal Unibrew’s stakes in the Dominica, St Vincent and Antigua breweries for USD 31 million, which the Danish brewer decided to sell in order to reduce debt. CND has since closed down the Antigua brewery (June 2011).

The several hundred Caribbean islands are gathered in some 30 countries, many of which have local breweries. The individual breweries typically produce beer, malt and soft drinks. In addition, many of them have licensing agreements to produce and/or distribute international brands. The prevalence of international beer brands is more or less dependent on the inflow of tourists.