Government authorities have approved Carlsberg's purchase of 9.94 % of Gorkha Brewery's shares from the Khetan Group, increasing Carlsberg’s stake in the company to 99.94%.

The Department of Industry has granted permission to the Danish multinational Carlsberg to acquire an additional 9.94% share in Gorkha Brewery Limited, previously held by the Khetan Group.

In July, Carlsberg announced that it held a 90% stake in Nepal's Gorkha Brewery Limited and had reached an agreement to acquire 9.94% of the remaining 10% shares.

Less than 1% of the shares remain with other Nepali entrepreneurs. At the time, Carlsberg stated that it still required approval from the Government of Nepal to finalise the transaction.

Three senior officials from the Department of Industry and the Nepal Rastra Bank confirmed to New Business Age that Carlsberg has secured this approval.

"Carlsberg used the dividends that were not repatriated in the past to purchase the Khetan Group’s shares," a source from the department revealed. "The company was granted permission to reinvest the withheld dividends within Nepal."

According to department officials, Carlsberg has not repatriated its dividends from Nepal for several years. Sources at Nepal Rastra Bank disclosed that Carlsberg paid over Rs 4 billion to acquire the Khetan Group's shares.

With this acquisition, Carlsberg now holds an almost complete stake in Gorkha Brewery. The transaction also ensures that the withheld dividends remain within Nepal. However, the central bank source added, "In the future, Carlsberg will have the right to repatriate nearly 100% of the dividends."

Nepal's Foreign Investment and Technology Transfer Act recognises reinvestments by foreign companies as foreign investments.

The Department of Industry stated that any party seeking to buy or sell shares must obtain prior approval from the relevant regulatory bodies in Nepal. For transactions conducted abroad, an application must be submitted within one month for official records. Following the decision to transfer shares, both Carlsberg and the Khetan Group applied for approval to the Department of Industry.

Carlsberg also announced that its Singapore-based subsidiary, Carlsberg (Singapore) Holdings Pte Ltd, had acquired the Khetan Group's 33.33% stake in Carlsberg South Asia Pte Ltd, which oversees its South Asian operations. Once the share transfer is complete, Carlsberg will hold 100% ownership of Carlsberg South Asia and a 99.94% stake in Nepal's Gorkha Brewery, according to the company's press release.

The total purchase price for the proposed transaction is USD 744 million (approximately Rs 100 billion). Carlsberg aims to complete the deal by the fourth quarter of 2024.

Gorkha Brewery produces popular beer brands in Nepal, including Carlsberg, Tuborg, and San Miguel.