Distilleries Company of Sri Lanka PLC (DCSL) has acquired Heineken Lanka Limited for Euro 12 million which will continue to produce international brands under a trademark licence agreement, a corporate disclosure from the Company said.

Accordingly, the Sri Lanka Distilleries has acquired 99.4% of the issued capital from Heineken Lanka Limited from Heineken Asia Pacific Private Limited for a total consideration of Euro 12 million.

With this acquisition, Heineken Lanka Limited is to change its name to DCSL Breweries Lanka Limited to reflect its new ownership. 

At the same time, the company is to continue to brew under world-renowned international brands under a trademark licence agreement signed with the Heineken Company. The company will also continue to brew its own brand. 

Back in November when the intention to acquire Heineken Lanka Limited was announced, Fitch Ratings said that Lion Brewery (Ceylon) PLC (AAA(lka)/Stable) could face more competition in the medium term following Distilleries Company of Sri Lanka PLC’s (DIST; AAA(lka)/Stable) decision for acquisition.

“Heineken is a distant second in Sri Lanka’s market for now, but we believe DIST has the industry know-how, market access and financial strength to elevate Heineken’s operations to a level that could weigh on Lion’s market share,” Fitch Ratings said.

At the end of the third quarter of 2023, Distilleries Company of Sri Lanka PLC recorded a profit after tax of Rs 7.1 billion for the period with a quarterly PAT of Rs 2.8 billion.

Heineken which owns about 14% of the global market share had a net revenue decline of 0.9% organically, In Asia Pacific in Q3 of 2023 with total consolidated volume down 4.7% and net revenue per hectolitre up 3.4%. 

 “Production volume continues to be affected by the economic slowdown in the region and was down organically by 4.6%. Volume trends improved relative to the first half of the year, as India was back to growth and stock levels in Vietnam normalised.” Heineken's financial statement said.