Tolaram Acquires 58.02% Diageo’s Shareholding in Guinness Nigeria
Diageo on Tuesday sold its majority shareholding in Guinness Nigeria PLC, which produces and distributes Guinness in Nigeria, to Tolaram, according to a regulatory filing filed on the Nigerian Exchange.
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.
Diageo, the owner of Johnnie Walker whisky and Tanqueray gin, said Tolaram will buy the 58% interest in Guinness Nigeria for N81.60 per share. The price represents a 63% premium to the 30-day volume weighted average share price. Diageo said it has entered a new, long-term partnership with Tolaram to accelerate the growth of Guinness in Nigeria and remains deeply committed to the country.
Diageo will retain ownership of the Guinness brand, but this will be licensed to Guinness Nigeria for the long-term, enabling its continued growth and development in the country under the stewardship of Tolaram.
Diageo said it will also remain in Nigeria through its wholly owned international premium spirits business. The completion of the transaction is expected to be in 2025, subject to regulatory approvals in Nigeria.
Diageo said the deal is consistent with its strategy to operate a flexible and asset-light beer operating model. It will continue to drive the brand and marketing strategy of Guinness in Nigeria, in partnership with Guinness Nigeria and Tolaram, Diageo added.
Diageo Chief Executive Debra Crew said: “I’m excited to announce our new partnership with Tolaram. Guinness has been Nigeria’s favourite beer for nearly 75 years. Tolaram shares this passion for Guinness and for Nigeria, making them the perfect partners as we continue to grow our business and seek to delight even more consumers in the country.”
Under the terms of an agreement signed today, June 11 June 2024, Tolaram will acquire Diageo’s 58.02% shareholding in Guinness Nigeria, and 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, according to the statement.
Diageo said it 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.
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.
In partnership with Guinness Nigeria and Tolaram, Diageo will continue to drive the brand and marketing strategy for Guinness in Nigeria, to ensure Diageo’s exceptional capabilities in brand building and innovation continue to drive long-term growth for Guinness in Nigeria.
However, 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.
Speaking about the deal, Omobola Johnson, Board Chair, Guinness Nigeria, said: “Today’s announcement represents a significant opportunity for the next 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 that leaves Guinness Nigeria extremely well placed to drive further growth in this market.”
Also, Adebayo Alli, Managing Director/Chief Executive Officer, Guinness Nigeria, said: “Today’s announcement marks an exciting moment for Guinness Nigeria, our employees, and our 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.”.
Also, Haresh Aswani, Managing Director, Tolaram Africa, said: “We are thrilled to welcome Guinness Nigeria, a company with such a rich legacy and strong consumer loyalty, into our ecosystem.
“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.” #Tolaram Acquires 58.02% Diageo’s Shareholding in Guinness Nigeria
