Nigerian Breweries has completed the acquisition of Distell Wines and Spirits Nigeria Limited, obtaining full ownership after purchasing an additional 20 percent stake. This acquisition simplifies operations and supports the company’s diversification strategy away from beer. The brewery is optimistic about capturing growth opportunities in the wines and spirits market, despite facing significant financial losses last year due to naira depreciation.
Nigerian Breweries, a subsidiary of Heineken N.V., has successfully completed its acquisition of Distell Wines and Spirits Nigeria Limited by purchasing an additional 20 percent stake, achieving full ownership. Last June, the brewery had initially acquired 80 percent of Distell following approval from South Africa’s Reserve Bank, which facilitated the transfer of shares from Heineken Beverages Holdings Limited.
This acquisition also allowed Nigerian Breweries to take over the import business of Distell International Limited within Nigeria. The company confirmed the full acquisition on Thursday, following a sale and purchase agreement with minority shareholders Ekulo International Limited and Next International Nigeria Limited, each previously holding a 10 percent stake.
Nigerian Breweries expressed that this full acquisition will streamline operations, reduce complexities, and enhance decision-making processes as it aims to diversify its product offerings beyond beer. The company anticipates that expanding into the wine market will significantly contribute to maximizing value within the local beverage industry.
In efforts to bolster production capacity, Nigerian Breweries has relocated its manufacturing operations from a rented facility to its own plant, optimizing the production of Distell Wines and Spirits brands. This strategic move is expected to benefit from economies of scale in its operations.
Chief Executive Officer Hans Essaadi noted that the acquisition aligns with strategic initiatives to develop a diverse portfolio of rapidly growing brands in the wines and spirits market, aiming to seize significant growth potential in the sector. Notable brands produced by Distell Wines and Spirits Nigeria include Chamdor and Hunters Dry, with Nigerian Breweries also importing various wines and spirits, such as Drosty Hoff and Amarula Cream Liqueur.
Despite the acquisition, Nigerian Breweries reported a record net loss of N145 billion last year, primarily due to a significant devaluation of the naira. The company’s total assets increased to N1.14 trillion by the end of 2024, compared to N1.13 trillion in the previous year.
Nigerian Breweries has completed the acquisition of Distell Wines and Spirits, enhancing its business portfolio and streamlining operations. This strategic move anticipates growth in the wines and spirits segment while addressing production efficiency through improved operational facilities. Despite recent financial challenges, the brewery aims to leverage the full acquisition to capture value and opportunities in the expanding beverage market.
Original Source: www.premiumtimesng.com
