In a significant corporate shift, Diageo, the foreign majority shareholder in Guinness Nigeria Plc, has agreed to sell its controlling equity stake of 58.02 percent to Tolaram, a Singaporean multinational company.
The agreement, signed on Tuesday, outlines that Tolaram will acquire Diageo’s shareholding and enter into long-term license and royalty agreements to continue producing the Guinness brand along with Diageo’s locally manufactured ready-to-drink and mainstream spirits.
As part of this acquisition, Tolaram will also undertake a mandatory tender offer to minority shareholders, potentially increasing its controlling stake. The transaction, pending regulatory approvals in Nigeria, is expected to conclude in 2025.
Despite this sale, Diageo will maintain ownership of the Guinness brand, which will be licensed to Guinness Nigeria for the long-term, ensuring the brand’s continued growth and development under Tolaram’s management.
Tolaram, with a five-decade presence in Africa, is one of the continent’s largest consumer packaged goods companies, known for its strong joint venture partnerships with leading multinational companies. This acquisition marks a significant opportunity for Guinness Nigeria to leverage Tolaram’s manufacturing and distribution expertise alongside Diageo’s renowned brand-building capabilities.
Guinness Nigeria will remain listed on the Nigerian Exchange (NGX), although past acquisitions in similar contexts have sometimes led to full takeovers and delistings.
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Omobola Johnson, Chairman of Guinness Nigeria, hailed the acquisition as a pivotal moment for the company’s growth. “This partnership brings together Tolaram’s deep expertise in manufacturing and distribution, and Diageo’s exceptional capabilities in brand building and innovation,” she stated.
Adebayo Alli, Managing Director of Guinness Nigeria, expressed excitement about the partnership. “I look forward to working alongside Tolaram, which is one of the largest and most respected consumer goods companies in Africa,” Alli said, emphasizing Tolaram’s alignment with Guinness Nigeria’s values and commitment to sustainability.
Haresh Aswani, Managing Director of Tolaram Africa, echoed these sentiments, describing the move as a strategic expansion of their footprint in Nigeria. “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.
As the transaction progresses, the partnership between Tolaram and Diageo promises to drive long-term growth for the Guinness brand in Nigeria, blending Tolaram’s operational strengths with Diageo’s brand expertise to enhance the market presence of Guinness Nigeria.