Asia Brewery Inc. and HEINEKEN are planning to dissolve their joint venture in favor of a new arrangement under which ABI will just brew and distribute the beer while HEINEKEN will do the sales and marketing.
In a disclosure to the Philippine Stock Exchange, ABI’s parent company LT Group Inc. said they have agreed to transition the AB HEINEKEN Philippines Inc. joint venture to a new partnership structure to produce and distribute HEINEKEN beer brands Heineken and Tiger in the Philippines.
“HEINEKEN will establish a sales and marketing office based in Manila and will engage Asia Brewery to brew and distribute its beers in the country. The expected date for the completion of the process is December 31, 2020,” LTG said.
It added that, “The immediate priority for Asia Brewery and HEINEKEN is to ensure a smooth transition for the employees of AB HEINEKEN Philippines and continuity for its customers and suppliers.”
LTG noted that, “The Philippines continues to present a good long-term business opportunity for HEINEKEN and both Asia Brewery and HEINEKEN remain committed to continue offering Heineken and Tiger beer to consumers in the country.”
For the first half of the year, ABI reported a net income of P40 million, 84 percent lower than the same period in 2019.
This was primarily due to lower volumes across ABI’s products as the enhance community quarantine affected sales in sari-sari and convenience stores as well as in supermarkets. Revenues were 17 percent lower.