Singapore based Tolaram has signed an agreement to a controlling stake in Guinness Nigeria Plc (NGX: GUINNESS) in a deal worth about ₦103.70 billion.
Also read; Presco Plc to acquire Ghana Oil Palm Development Company Limited
Under the terms of the agreement signed on Tuesday, 11th June 2024, Tolaram will acquire Diageo’s 58.02% shareholding in Guinness Nigeria. The agreement further stipulates that it will enter into long-term license and royalty agreements for the continued production of the Guinness brand and its locally manufactured Diageo ready-to-drink and mainstream spirits brands.
The transaction is expected to be completed during Fiscal 2025, subject to obtaining the requisite regulatory approvals in Nigeria.
Diageo Plc is the parent company of Guinness Overseas Limited and Atalantaf Limited, both of whom owned 50.18% and 7.84% shares of Guinness Nigeria Plc respectively as at 30 June, 2023.
Tolaram will acquire the shares totaling 1,270,943,368 at a price of ₦81.60 per share, a 63% premium to the 30-day VWAP. At the end of trading on Tuesday, the share price of GUINNESS stood at ₦54.80 on the floor of the Nigerian Exchange.
In a regulatory filing on the Nigerian Exchange, Diageo restated it deep commitment to Nigeria and state it will retain ownership of the Guinness brand, which will be licensed to Guinness Nigeria for the long-term, enabling the next phase of growth and development of Guinness Nigeria under the stewardship of Tolaram.
Following completion of this transaction, Guinness Nigeria will remain listed on the Nigerian Exchange Ltd. and, subject to regulatory approvals, Tolaram intends to launch a mandatory takeover offer in compliance with local law requirements.
Guinness Nigeria had in October announced that, with effect from April 2024, it will no longer import or distribute certain Diageo international premium spirits products, including Johnnie Walker, Singleton, and Baileys and others imported under its 2016 Sale & Distribution Agreement with Diageo plc.
With a five-decade presence in Africa, Tolaram is one of the largest consumer packaged goods companies on
the continent and has forged joint venture partnerships with several leading consumer multinational companies.
About Tolaram
Established in 1948, Tolaram is a Singapore incorporated and headquartered enterprise that operates a diversified business portfolio encompassing the consumer, infrastructure, and fintech verticals across Africa, Asia, and Europe.
In Nigeria, its consumer business operates under joint ventures with leading consumer multinational companies such as Indofood, Kellanova (formerly known as Kellogg Company), Dano, and Colgate-Palmolive. Under these partnerships, Tolaram manufactures and distributes Nigeria’s leading brands, including Indomie, Minimie Chinchin, Kellogg’s, Munch It, Power Oil, Power Pasta, Dano, Hypo, and Colgate, amongst others.
Tolaram’s success in Nigeria has enabled further expansion into Ghana, Egypt, South Africa, Eswatini, Kenya, Ivory Coast, Mozambique and Saudi Arabia.
Today, Tolaram operates 30 world-class manufacturing facilities across Africa, of which 25 are in Nigeria with many of them based in the Lagos Free Zone, Tolaram’s wholly owned private free trade zone.
Tolaram has a significant presence in Nigeria, with over 15,000 employees and combined investments of over $1 billion.
About the company
Guinness Nigeria Plc, a public Company quoted on the Nigerian Stock Exchange, was incorporated in Nigeria on 29 April 1950, as a trading company importing Guinness Stout from Dublin.
The Company has since transformed itself into a manufacturing operation and its principal activities continue to be brewing, packaging, marketing and selling of of Guinness Foreign Extra Stout, Guinness Smooth, Malta Guinness, Guinness Gold, Harp Lager, Smirnoff Ice, Satzenbrau Lager, Dubic Malt, Snapp, Orijin Spirit Mixed Drink, Orijin Bitters, Smirnoff Ice Double Black with Guarana, Orijin Zero and Orijin Herbal Gin, Baileys Delight, Gordons Moringa among others.
It has 2,190,382,819 outstanding ordinary shares.
Nnamdi Maduakor is a Writer, Investor and Entrepreneur
