Nigerian Breweries Plc has announced that it will complete the final stage of its acquisition of 80% of Distell Wines & Spirits Nigeria Limited by the end of Q2 2024.
At a pre-AGM press event in Lagos, Hans Essaadi, Managing Director/CEO of Nigerian Breweries Plc, stated that the company had executed the transaction documents with Heineken Beverages (Holdings) Limited of South Africa, following shareholders’ approval at the Extraordinary General Meeting in December 2023.
The company has subsequently executed the transaction documents with Heineken Beverages (Holdings) Limited of South Africa for the acquisition of an 80% equity stake in Distell Wines and Spirits Nigeria and the acquisition of 100% of Heineken Beverages’ import business in Nigeria.
He added that the acquisition of Distell Wines and Spirits would help Nigerian Breweries to future-proof its business and enhance its long-term profitability by adding new products in the wines, spirits, and flavoured beverages categories.
Despite ending 2023 with an operating profit of N45 billion, Nigerian Breweries recorded a net loss of N106 billion due to the devaluation of the naira and higher cost of funds. As a result, the board proposed a recapitalisation scheme by way of rights issue for approval at the AGM.
The objective is to raise fresh capital up to N600 billion that would be used to settle the outstanding Fx payables and part of the local bank facilities, thus eliminating the naira devaluation risk/huge foreign exchange losses and reducing the interest burden on the company. Heineken N.V., the majority shareholder, has indicated its readiness to support the proposal.
Uaboi G. Agbebaku, Company Secretary, emphasized Nigerian Brewery’s commitment to minimizing the impact of brewery suspensions in Awo-Omamma, Imo State and Kakuri, Kaduna State, on its workforce by exploring all feasible alternatives.
He added that the company would offer support and severance packages to affected employees, and build an oil palm mill in Awo-Omamma and support Kakuri with another project.