AB InBev to increase equity stake in Nigerian operation post-merger

Anheuser-Busch InBev, the Belgian brewer which controls three independently operated breweries in Nigeria will increase its majority equity stake in International Breweries Plc (“IBPlc”) to 75.1% following the completion of the ongoing merger of its Nigerian operations.

AB InBev announced in early June that the Board of Directors of its three indirect Nigerian subsidiaries – IBPlc, Intafact Beverages Limited and Pabod Breweries Limited had agreed to explore a merger of their operations subject to regulatory and shareholder approvals.

The firm followed up in August by announcing it had secured the needed regulatory approvals from the Nigerian Securities and Exchange Commission (“SEC”) and the Nigerian Stock exchange (“NSE”) to merge its operations in Nigeria.

According to a report by the Nations Newspaper, the three indirect subsidiaries of AB InBev will each hold a court-ordered meeting in October at which time shareholders are expected to approve the merger.

The report further states that AB InBev currently holds 72.17% majority stake in IBPlc through its direct subsidiary Brauhaase International Management GMBH. At the completion of the merger, AB InBev’s equity in the enlarged company will rise to 75.1%.

SABMiller Nigeria Holdings BV, another direct subsidiary of Anheuser-Busch InBev is said to hold 75% and 82.81% majority stake in Intafact Beverages and Pabod Breweries respectively, while the Anambra State Government and Rivers State Government each hold 10% and 14.52% equity in Intafact and Pabod respectively.

The post-merger will see SABMiller Nigeria Holdings BV and Brauhaase International Management GMBH hold 47.4% and 27.7% equity stake respectively in the enlarged International Breweries Plc, given AB InBev controlling equity of 75.1%, while Anambra State Government equity will reduce to 4.7% and other minority shareholders will hold 20.2% equity.

The boards of directors and management of the three companies said the enlarged company will provide strategic opportunities and benefits to shareholders, employees and customers. The merger is also expected to impact positively on the brewing industry and the entire Nigerian economy.

IBPlc makes the very popular Trophy Lager, among others, while Intafact and Pabod produce also the very popular Hero Lager and Grand Lager beers among others respectively.

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