Heineken already owns a 21 per cent stake in Kingway through its Heineken Asia Pacific Breweries China joint venture with Singapore's Fraser & Neave, and while the company has yet to confirm that a deal had been reached, it would be in line with most international companies' development strategies in China.
The likes of SABMiller, InBev and Anheuser-Busch have all looked to increase their regional holdings in the highly fragmented Chinese market, snapping up breweries as they seek to create a strong platform on which to roll out a number of brands nationwide.
Heineken's presence in China has been relatively limited. It made the mistake of building its own brewery there back in the late 1990s when costs were high and there was little or no interest in premium international brands, and has struggled to turn a profit as a result. However, it recently announced its intention to return to the fray now that the market has been developed by other foreign brewers, creating a new company with long-time partner F&N to seek investment opportunities.
But Heineken is still a long way behind many of its rivals in China, and its pretensions are likely to be limited to the local market, at least in the medium-term. While SABMiller and Anheuser-Busch begin to roll out a handful of their brands on a national level - including their international premium labels - Heineken is likely to focus its efforts on the Guangdong region in the south east where Kingway is based, and on Hainan where its joint venture brewery with APB is located.
Suntory, meanwhile, is one of several Japanese brewers with a growing presence in China. Although its acquisitions there (along with those of compatriots such as Kirin and Asahi) have not been as extensive as those of, say, InBev, Suntory has maintained its presence in China for several years, focusing mainly on the Shanghai market.
The company will now take a 74 per cent stake in Shanghai Donghai Brewery Co, increasing its stranglehold on the local market in Jiangsu and Shanghai. The Japanese group controls around a third of volume sales there, with sales of some 360,000 tons, and the acquisition should lift its share to more than 50 per cent.