Diageo, the UK-based majority owner of Guinness Nigeria, has announced that it will be selling its 58.02 per cent stake in the company to Tolaram Group, a Singapore-based conglomerate.
The deal, valued at approximately £53.8 million, marks a significant shift in the ownership structure of Guinness Nigeria.
According to an announcement at the Nigerian Exchange on Tuesday, Under the terms of the agreement, Tolaram will acquire Diageo’s majority stake in Guinness Nigeria and enter into long-term licence and royalty agreements for the continued production of the Guinness brand and locally manufactured Diageo ready-to-drink and mainstream spirits brands. The transaction is expected to be completed in 2025, pending necessary regulatory approvals in Nigeria.
Despite divesting its stake in Guinness Nigeria, Diageo emphasised its commitment to the Nigerian market and its continued involvement in the brand’s growth and development. The company will retain ownership of the Guinness brand, which will be licensed to Guinness Nigeria for the long term.
This is as President Bola Tinubu has commended the Indonesian business conglomerate, the Tolaram Group, for believing in Nigeria and having absolute faith in her economy.
Tolaram, has also partnered Nigeria to build the Lekki Free Trade Zone and the country’s first deep sea port,
Tolaram, with a five-decade presence in Africa, is a major player in consumer packaged goods and has formed joint ventures with several leading multinational companies. The company plans to launch a mandatory takeover offer to minority shareholders following the completion of the transaction.
The deal is seen as a strategic move by Tolaram to expand its footprint in the Nigerian market and leverage its combined strengths with Diageo to foster innovation and deliver value to customers and shareholders.
Meanwhile President Tinubu said Tolaram, by acquiring Diageo’s shares in Guinness, had shown that it has a long-term view of doing business in Nigeria.
Tolaram has been doing business in Nigeria in the last 50 years.
In a statement by his special adviser information and strategy, Bayo Onanuga Tinubu said that in choosing to expand its investment footprints in Nigeria, Tolaram has demonstrated strong faith and confidence in Nigeria’s economy.
President Tinubu welcomes Tolaram to the beverage sector of Nigeria’s business landscape and hopes the group’s business will continue to flourish.
President Tinubu gives assurances to investors and Nigeria’s businesses, promising that his government will continue to make the operating environment more conducive and transparent.
He said that the multi-pronged reforms and interventions being implemented on the economic and financial fronts would deliver sustained growth and enduring profitability for investors.
In partnership with Guinness Nigeria and Tolaram, Diageo will continue to drive the brand and marketing
strategy for Guinness in Nigeria, to ensure Diageo’s exceptional capabilities in brand building and innovation
continue to drive long-term growth for Guinness in Nigeria.
Following completion of this transaction, Guinness Nigeria will remain listed on the Nigerian Exchange Ltd. and,
subject to regulatory approvals, Tolaram intends to launch a mandatory takeover offer in compliance with local
law requirements.
Omobola Johnson, Board Chair, Guinness Nigeria, said: “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, Guinness Nigeria, said: “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, Tolaram Africa, said: “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.”
Commenting on the announcement, Diageo CEO Debra Crew expressed excitement about the new partnership, stating, “I’m excited to announce our new partnership with Tolaram. Guinness has been Nigeria’s favourite beer for nearly 75 years. Tolaram shares this passion for Guinness and for Nigeria, making them the perfect partners as we continue to grow our business and seek to delight even more consumers in the country.”
The transaction is expected to have a positive impact on Guinness Nigeria’s growth and development, with the company’s board chair, Omobola Johnson, describing the partnership as a significant opportunity for the next phase of growth.
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