LAGOS, Nigeria ( VOICE OF NAIJA)-Guinness Nigeria Plc, a subsidiary of the multinational corporation Diageo, is set to undergo a significant ownership change as Diageo agrees to sell its controlling equity stake of 58.02 per cent to Tolaram, a Singaporean multinational.
The announcement, made via a press release on the official NGX website on Tuesday, indicates that the transaction is expected to close in fiscal 2025, pending regulatory approvals.
This move by Diageo to sell its stake adds to the trend of multinational corporations divesting from Nigeria due to challenging economic conditions.
Tolaram has inked a deal on Tuesday to purchase Diageo’s 58.02 per cent stake in Guinness Nigeria.
As part of the agreement, Tolaram will also establish long-term license and royalty arrangements to sustain the production of Guinness brand, alongside Diageo’s ready-to-drink and mainstream spirits brands manufactured locally.
Tolaram will also initiate a mandatory tender offer aimed at acquiring shares held by minority shareholders.
This transaction has the potential to further bolster the new core investor’s controlling stake in the company.
“Diageo remains deeply committed to Nigeria and 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,” Guinness Nigeria stated.
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Guinness Nigeria emphasized that in collaboration with Tolaram, Diageo will maintain its role in shaping the brand and marketing strategy for Guinness in Nigeria.
This partnership aims to leverage Diageo’s expertise in brand building and innovation to foster sustained long-term growth for Guinness in the country.
Despite the completion of the transaction, Guinness Nigeria will retain its listing on the NGX, as outlined in the agreement. However, it’s worth noting that recent acquisitions have resulted in the complete takeover and subsequent delisting of companies.
Chairman, of Guinness Nigeria, Omobola Johnson stated that the acquisition announcement signifies a substantial opportunity for the upcoming phase of growth for Guinness Nigeria.
“This partnership brings together Tolaram’s deep expertise in manufacturing and distribution, and Diageo’s exceptional capabilities in brand building and innovation. I believe this is a winning combination which leaves Guinness Nigeria extremely well placed to drive further growth in this market,” he said.
Likewise, Managing Director of Guinness Nigeria, Adebayo Alli characterized the announcement as an exhilarating moment for Guinness Nigeria, its employees, and its customers.
“I look forward to working alongside Tolaram, which is one of the largest and most respected consumer goods companies in Africa, and I am pleased to note Tolaram’s alignment with Guinness Nigeria’s values and its strong commitment to build an enduring and sustainable business,” Alli said.
Managing Director of Tolaram Africa, Haresh Aswani, expressed the group’s excitement in welcoming Guinness Nigeria, a company with a rich legacy and strong consumer loyalty.
“This strategic move will expand our significant footprint in the Nigerian market and presents an opportunity to leverage our combined strengths to foster innovation and deliver immense value to our customers and shareholders across the nation,” Aswani said.