Diageo sells majority stake in Guinness Nigeria to Singapore’s Tolaram
TLDR
- Diageo sells majority stake in Guinness Nigeria to Tolaram for N81.60 per share.
- Singaporean conglomerate Tolaram acquires 58% stake in Lagos-listed company for about N103 billion.
- Tolaram sees acquisition as a significant step in its growth and diversification journey in Africa.
Diageo is selling its majority shareholding in its subsidiary Guinness Nigeria, becoming the latest Western company to scale down its presence in Africa’s most populous nation on the back of a long-running currency crisis and economic downturn.
The spirits giant will sell its 58% stake in the Lagos-listed company to Singaporean conglomerate Tolaram for N81.60 per share or about N103 billion ($70 million).
“The acquisition of Guinness Nigeria marks a pivotal moment in Tolaram’s journey of growth and diversification,” said Haresh Aswani, the group’s managing director in Africa. “We are thrilled to welcome a company with such a rich legacy and strong consumer loyalty into our ecosystem.”
Key Takeaways
Western consumer groups, including Unilever, GSK, and PZ Cussons, have been retreating from Nigeria over the past year due to a chronic shortage of foreign exchange and a sharp decline in the value of the naira. In contrast, Tolaram, with joint ventures involving leading multinationals such as Kellanova and Colgate-Palmolive, remains heavily invested in Nigeria, with over $1 billion in combined investments. This trend is part of a broader shift, with non-western groups like Singapore-listed Olam and Turkey’s Hayat Kimya increasing their investments in Nigeria. Analysts note that these companies provide the Nigerian market with cheaper alternatives and possess a higher risk tolerance compared to their Western counterparts.
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