Guinness Gains NGX Approval For Block Divestment Deal Worth N103bn

Guinness Gets NGX Green Light for N103 Billion Block Divestment

Guinness Nigeria Plc has secured the approval of the Nigerian Exchange Limited (NGX) for a significant block divestment deal valued at N103 billion.

This move involves the sale of 1.27 billion ordinary shares, each priced at N81.60, marking a notable transaction in the Nigerian stock market.

The transaction represents a premium price compared to the current market value of Guinness Nigeria Plc shares, which stood at N63.50 per share as of September 17.

The company, listed in the beverages – Brewers/Distillers sub-sector of the Nigerian Exchange Limited, has a total market capitalisation of N139.09 billion, with 2.19 billion outstanding shares.

NGX Approval and Role of Stanbic IBTC

According to the NGX Regulation Limited, the approval for the block divestment was granted on September 6, 2024. Stanbic IBTC Stockbrokers Limited has been appointed as the official stockbroker for this major transaction.

The divestment will see Guinness Nigeria Plc’s shares sold to NSeven Nigeria Limited, which will acquire 58.02% of the company’s issued shares. This stake was previously held by Guinness Overseas Limited and Atalantaf Limited, both subsidiaries of Diageo Plc.

“Securing this approval is a major step forward for Guinness Nigeria Plc,” stated a representative of the company. “The sale of the shares is part of our long-term strategy to align with the evolving market dynamics and ensure sustainable growth.”

READ ALSO: Tolaram To Acquire Diageo’s 58% Stake In Guinness Nigeria

Background of the Deal

This development follows an earlier announcement in June 2024, when Guinness Nigeria Plc revealed that Tolaram, a Singapore-based holding company, had agreed to spend N103 billion (approximately $70 million) to acquire Diageo’s 58.02% shareholding in the company.

The deal was formalised with the signing of the terms of the agreement by all parties involved.

“This acquisition by Tolaram shows confidence in the Nigerian market and the long-term potential of Guinness Nigeria Plc,” said an industry analyst. “It’s also a positive sign for investors, as the premium price of N81.60 per share is significantly higher than the current market value.”

Major Shareholders in Guinness Nigeria Plc

As of the latest Register of Members, Guinness Overseas Limited holds the largest stake in Guinness Nigeria Plc, with 50.18% of the company’s shares, followed by Atalantaf Limited, which holds 7.84%.

Stanbic IBTC Nominees Limited and Mutima Opportunity Fund LP also hold substantial shares, with 6.40% and 5.61% respectively.

The recent NGX-approved divestment deal, therefore, represents a significant change in ownership structure, as the shares held by Diageo’s subsidiaries are transferred to NSeven Nigeria Limited.

Market Impact and Investor Confidence

The block divestment deal is expected to boost investor confidence in Guinness Nigeria Plc and may lead to increased trading activity in the company’s shares. Analysts predict that the premium price of N81.60 per share might signal a potential revaluation of the company’s stock shortly.

“This deal has the potential to positively impact the company’s stock performance and increase liquidity in the market,” remarked a market expert. “Investors are likely to be encouraged by the confidence shown by Tolaram in acquiring a majority stake in Guinness Nigeria Plc.”

As they move forward with this strategic divestment, the company aims to strengthen its position in the Nigerian market, focusing on expanding its product offerings and enhancing operational efficiency.

Guinness Nigeria Plc’s Role in the Nigerian Economy

Guinness Nigeria Plc has long been a significant player in Nigeria’s beverages sector, with its range of products widely consumed nationwide.

As the company undergoes this shift in ownership, it remains committed to maintaining its market leadership and providing high-quality beverages to Nigerian consumers.

The approval of this block divestment deal by the NGX marks a new chapter for the brewer, signalling potential growth opportunities and further investment in the Nigerian economy.