Brazil: Heineken N.V. announced on November 3 that, following its press release dated September 8, 2004, it has decided to take an impairment charge of € 190 million on its 20%-minority stake in the Brazilian Brewery Company Cervejarias Kaiser, reducing the carrying value of its investment to zero.

As minority shareholder, Heineken has no effective influence over the management and over the policies of Kaiser in Brazil. Further, given the development of the real versus the euro, and the current financial performance of Kaiser, Heineken believes that the value of its minority stake is severely impaired. It has been decided to provide for an impairment charge equal to 100% of the amount of the investment. Although the business as a whole has a value, Heineken is unable to determine the realizable value of its 20%-stake with any accuracy or reliability.

The impairment will be reported in the profit and loss account as a non-cash, exceptional item in the fourth quarter of 2004, and has no impact on Heineken's organic rate of profit growth.

In order to preserve its current position in the important Brazilian beer market, Heineken is considering participating in the capital increase of C$ 45 million announced by Molson on 28 October 2004.

E-malt.com, the global information source for the brewing and malting industry professionals. The bi-weekly E-malt.com Newsletters feature latest industry news, statistics in graphs and tables, world barley and malt prices, and other relevant information. Click here to get full access to E-malt.com. If you are a Castle Malting client, you can get free access to E-malt.com website and publications. Contact us for more information at marketing@castlemalting.com .