Nigerian Breweries Plc undertakes N599.1b rights issue

Following receipt of the approval of its shareholders in April 2024, Nigerian Breweries Plc (“Nigerian Breweries” or the “Company”) has now received clearance of the relevant documents from the Securities and Exchange Commission and NGX Regulation Limited.

The Company plans to raise ₦599,098,517,648.00 (Five Hundred and Ninety-Nine Billion, Ninety-Eight Million, Five Hundred and Seventeen Thousand, Six Hundred and Forty-Eight Naira) by way of a Rights Issue (the “Issue”).

A total of 22,607,491,232 (Twenty-Two Billion, Six Hundred and Seven Million, Four Hundred and Ninety-One Thousand, Two Hundred and Thirty-Two) Ordinary Shares of 50 kobo each in the share capital of Nigerian Breweries are being offered to shareholders whose names appear in the register of members as of the qualification date being 12 July, 2024.

The Issue shall be on the basis of eleven (11) new Ordinary Shares for every five (5) Ordinary Shares held as of the qualification date and at an Issue price of ₦26.50 per Ordinary Share.

The Issue is part of Nigerian Breweries’ Business Recovery Plan to strengthen the Company’s capital base by leveraging its balance sheet, eliminating certain FX-related exposures and reducing bank borrowings, thereby giving the Company greater financial flexibility to promote business growth and continuity.

Vetiva Advisory Services Limited and Stanbic IBTC Capital Limited are acting as the Lead Issuing House and the Joint Issuing House to the Issue respectively, to assist the Company in managing the Issue process. The acceptance list for the Issue is expected to open on 2 September, 2024 and close on 11 October, 2024.

At the signing ceremony held on 28 August, 2024, the Managing Director, Nigerian Breweries, Hans Essadi, explained that the Issue represents an opportunity for shareholders to support the company’s strategic vision and participate in the next phase of its growth.

Mr Essaadi further disclosed that the proceeds of the Issue will be channeled towards payment of its foreign and local currency denominated obligations, thereby eliminating foreign exchange risk and revaluation losses and enhancing long term profitability and sustainable value creation for its shareholders.

In his remarks, the Managing Director, Vetiva Advisory Services Limited, Olutade Olaegbe, commended the management of Nigerian Breweries for their visionary leadership and their commitment towards executing the Issue. He also thanked the Company for trusting Vetiva Advisory services Limited and Stanbic IBTC Capital Limited to advise on this landmark transaction and expressed confidence that the Issue would encourage other global multinational companies to approach the equity capital markets to meet their strategic objectives.

Full terms of the Issue will be set out in a Rights Circular to be mailed directly to qualifying shareholders of the Company, which will contain a Provisional Allotment Letter and the Acceptance Form. All shareholders should read the Rights Circular and, where in doubt, consult their Stockbroker, Fund/Portfolio Manager, Accountant, Banker, Solicitor or any other professional adviser for guidance before subscribing.

Nigerian Breweries Plc, the pioneer and largest brewing Company in Nigeria was incorporated in 1946 as Nigerian Breweries Limited. The Company was listed on the floor of the Nigerian Exchange Limited (“NGX”) in 1973 and is currently trading on the NGX with a market capitalisation of ₦294.4bn (US$186.7m) as of 23 August, 2024.

The Company is a market leader in the FMCG sector with a broad portfolio of popular and high-quality brands including Star Larger Beer (1949), Gulder Larger Beer (1970), Maltina (1976), Legend Extra Stout (1992), Amstel Malta (1994), Heineken Beer (1998), Fayrouz (2006), Climax Herbal Energy Drink (2010), Ace Brand (2015), Tiger Larger (2018), amongst others.

Nigerian Breweries has seven strategic brewery locations pan-Nigeria from which its high-quality products are produced and distributed to all parts of the Country. The Company also has an export business dating back to 1986 with the United Kingdom, the Netherlands, United States of America, Canada, some parts of Africa and parts of the Middle East and Asia as current export destinations.