* Kirin to invest $400 million in joint venture
* Kirin says venture will help it expand in China
* Kirin to transfer local subsidiaries to venture (Adds announcement, details)
By James Topham
TOKYO, Jan 24 (Reuters) - Japanese brewer Kirin Holdings said on Monday it has agreed to establish a joint venture with China's top beer maker China Resources Enterprise, to produce and distribute non-alcoholic beverages in the country.
Kirin will invest about $400 million to take a 40 percent stake in the venture, with China Resources Enterprise to hold the rest, the Japanese firm said in a statement.
Kirin will transfer ownership of four local subsidiaries in Shanghai and Beijing to the joint company, it said in a release.
The venture, which will enable Kirin to tap the Chinese company's sales network, "will speed up (the Japanese company's) foray into new product categories and new markets throughout China," Kirin said. The Chinese company operates a network of 3,000 stores.
The move is part of Kirin's strategy, pursued over the past several years, to diversify its operations and grow outside its saturated home market, where it vies for the top spot for sales of beer with Asahi Breweries.
Japan's beer market shrank by a little over 15 percent in terms of shipment volumes over the past decade, forcing the industry to cut costs and look abroad for growth.
Kirin has taken stakes in Singapore's Fraser & Neave, San Miguel Brewery of the Philippines and Australia National Foods and Dairy Farmers, as well as Lion Nathan, in hopes of securing overseas growth drivers.
China Resources, which produces China's top beer brand, Snow, with SABMiller Plc, is working to expand its retail network and buy brewery assets in China.
In November, China Resources said it would buy a 45 percent stake in Hangzhou Xihi Beer, as it works to strengthen its position in China's market amid growing competition from other brands including Tsingtao Brewery Co Ltd.
Kirin's shares gained 1.1 percent in Tokyo to 1,107 yen on Monday, while trading of China Resources Enterprise shares was suspended in Hong Kong. The companies made the announcement after the stock markets closed. (Additional reporting by Taiga Uranaka and Tim Kelly; Editing by Chris Gallagher)