Heineken agrees to sell Seville brewery to cut debt
Heineken NV, the Dutch brewer that controls 30% of the Spanish beer market, that its subsidiary Heineken España, S.A. in Spain has signed an agreement to sell a brewery in Seville to a unit of Grupo Urvasco SA. As the result of the sale Heineken will realise a book gain of €329 million before tax in the second half of 2006, which will be treated as an exceptional item. Heineken will book an after-tax gain of € 279 million ($359 million) from the sale in the second half of the year, according to a statement on the company's Web site. Heineken España is in the process of constructing a new brewery just outside of Seville and will abandon the current site, which has a size of more than 150,000 square meter, on 31 March 2008.
The land and buildings will be sold to the Spanish development group Viviendas Ciudad de Sevilla, S.A., which is part of the Grupo Urvasco, S.A. Parties have agreed not to disclose the consideration for the transaction. Heineken will use part of the proceeds of the sale to repay debt incurred to finance the construction of the new brewery in Seville. The sale of the land is consistent with Heineken’s strategy to release cash that is locked up in non-core assets. Heineken made the announcement after the Dutch market closed. The company's stock dropped 16 cents to € 36.05 in Amsterdam. (Bloomberg, heinekeninternational.com)ADVERTISEMENT
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