Nigeria’s International Breweries will secure about N123 billion investment from Belgian company, AB InBev (Anheuser-Busch InBev). AB InBev, the world’s largest brewer is looking to expand its footprint across Nigeria and other markets in sub-Saharan Africa.
This new capital infusion will solidify the grip of AB InBev on its African markets through its subsidiaries, one of which is the International Breweries, producers of Trophy Lager, Hero Lager and Betamalt – a non-alcoholic malt drink.
Channel of investment: AB InBev will make the N123 billion investment through a rights issue. This is the selling of shares by a company (in this case, International Breweries) to its existing shareholders (AB InBev) and is another way of raising cash by companies.
International Breweries will issue shares as a registered company on the Nigerian Stock Exchange (NSE) where shares are sold to existing or new shareholders. The company has filed for final regulatory approvals to raise the funds.
According to The Nation report, N164.39 billion will be raised by International Breweries through a rights issue of 18.266 billion ordinary shares of 50 kobo each at N9 per share which will be pre-allotted on the basis of 17 new ordinary shares of 50 kobo each for every 8 ordinary shares of 50 kobo each held as at the close of business on November 6, 2019. With the rights’ ratio, about 13.72 billion ordinary shares of 50 kobo each will be pre-allotted to AB Inbev.
What you need to know: International Breweries is a combination of three Nigerian Breweries companies – International Breweries Plc, Intafact Beverages Limited and Pabod Breweries Limited. AB InBev is the highest shareholder in all.
International Breweries is located in Ilesa, Osun State in the South West region. Intafact Beverages’ brewery is situated in Onitsha, Anambra State in the South-East region while Pabod Breweries is located in Oginigba, Port Harcourt, Rivers State in the South-South region.
The three companies were merged in 2017 by AB InBev in a bid to expand its shares and position International Breweries as a market leader in Africa.