Tolaram, a leading consumer packaged goods company, has announced the acquisition of Diageo’s 58.02% shareholding in Guinness Nigeria for a share price of 81.60 NGN per share, a 63% premium to the 30-day VWAP. This strategic move, signed on June 11, 2024, marks the beginning of a new era for Guinness Nigeria, poised to benefit from Tolaram’s extensive expertise in manufacturing and distribution.
Under the terms of the agreement, Tolaram will acquire the majority stake in Guinness Nigeria and will enter into long-term license and royalty agreements. These agreements ensure the continued production of the iconic Guinness brand along with Diageo’s locally manufactured ready-to-drink and mainstream spirits brands. The transaction is anticipated to be completed during Fiscal 2025, contingent upon the requisite regulatory approvals in Nigeria.
Despite the change in ownership, Diageo will retain ownership of the Guinness brand and will license it to Guinness Nigeria for the long term. This arrangement will allow Diageo to remain actively involved in the brand’s strategy and innovation, ensuring the sustained growth and development of Guinness Nigeria under Tolaram’s stewardship.
Tolaram, with a robust five-decade presence in Africa, has established itself as a powerhouse in the consumer packaged goods sector. The company’s joint venture partnerships with several leading multinational consumer companies underscore its capability and commitment to the African market. Tolaram’s acquisition of Guinness Nigeria is expected to enhance its significant footprint in the Nigerian market, leveraging combined strengths to foster innovation and deliver value.
Omobola Johnson, Board Chair of Guinness Nigeria, highlighted the strategic advantages of this partnership, stating, “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 which leaves Guinness Nigeria extremely well placed to drive further growth in this market.”
Adebayo Alli, Managing Director/Chief Executive Officer of Guinness Nigeria, expressed enthusiasm about the future, saying, “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.”
Haresh Aswani, Managing Director of Tolaram Africa, echoed this sentiment, adding, “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.”
Following the completion of this transaction, Guinness Nigeria will continue to be listed on the Nigerian Exchange Ltd. Subject to regulatory approvals, Tolaram plans to launch a mandatory takeover offer in compliance with local law requirements. This move is expected to further consolidate Tolaram’s position in the Nigerian market and drive the next phase of growth for Guinness Nigeria.
In partnership with Tolaram, Diageo will continue to drive the brand and marketing strategy for Guinness in Nigeria.
With this divestment, Diageo has joined the likes of other multinationals like Unilever Plc, Procter & Gamble Co., GSK Plc and Sanofi that have recently announced that they are either cutting back on their exposure or exiting the country. It has not been rosy for the c
