Heineken Clears Legal Hurdle To Sell Its Beer In India

Though the average resident of India sips half a six-pack of beer each year – compared with the six cases put away by those in hops-happy nations – the population-dense country is considered “the last frontier for significant growth in the beer industry” by Heineken’s chief executive, Jean-François von Boxmeer.

The Dutch beer brand targeted India as a growing market three years ago, adding 76 percent ownership of India's Aurangabad Breweries to its majority stake of Asia Pacific Breweries (APB), which brews the popular Tiger Beer.

A legal dispute concerning another Indian beer conglomerate – United Breweries, the top brewer in India – was finally untangled, paving the way for tapped Heineken kegs in pubs from Srinagar to Thiruvananthapuram.

The wrangling was over a conflict of interest in the Indian beer market. APB was founded in 1931 via a partnership between Heineken and yet another conglomerate, Singapore-based Fraser and Neave Limited. In 2007, when Heineken (along with Danish brewer Carlsberg) bought Scottish & Newcastle, a popular European beer brand, the company inherited a 37.5 percent stake in APB competitor United Breweries (UB), which brews India’s best-selling beer, Kingfisher.

The agreement, which involves enough compromises, retracted lawsuits, and financials to make you reach for a cold one, clears the way for UB to brew and distribute Heineken in India, while Heineken promotes Kingfisher internationally.

Three beers per Indian doesn’t sound like a lot of lager, but that market is relatively, well, untapped – and it’s growing at a faster rate than Western markets. (And need we mention that India is the second-most populated country in the world?)

The agreement sounds like such a win-win for both Heineken and UB, it’s a wonder the brand's reps couldn’t just settle the matter over a couple of pints.