World’s Largest Brewer Anheuser-Busch InBev To Increase Nigeria Equity Stake After 3 Way Merger

by Ike Obudulu Posted on September 25th, 2017

Abuja, Nigeria. Sept 24: At the conclusion of the three way merger that will consolidate it’s Nigerian Businesses into a single entity that will retain the name International Breweries Plc, the world’s largest brewer Anheuser-Busch InBev will increase its majority equity stake in the newly merged International Breweries Plc, to 75.1 per cent.

Anheuser-Busch InBev has already received the regulatory approvals from the Securities and Exchange Commission (SEC) and Nigerian Stock Exchange (NSE) to merge its businesses in the country in a strategic move to upend competition and consolidate its base for further expansion into  sub-Saharan Africa.

Under the arrangement, three indirect Nigerian subsidiaries of Anheuser-Busch InBev-International Breweries Plc, Intafact Beverages Limited and Pabod Breweries Limited, will be merged.

All assets, liabilities and undertakings of Intafact and Pabod including employees, real property and intellectual property rights will be transferred to International Breweries upon the completion of the proposed merger. Shareholders of the two other companies-Intafact and Pabod, will be issued ordinary shares of International Breweries in exchange for their shareholdings in the merged companies.

The three companies will each hold court-ordered meeting next month during which shareholders are expected to approve the business combination.

Under the laws and rules on merger and acquisition, voting at the court-ordered meeting, being held at the instance and approval of the Federal High Court, will be by poll with each share representing a vote. The majority for business combination and other material changes in shareholding and operating structures is at least 75 per cent of the value of shares of members present and voting either in person or by proxy.

Anheuser-Busch InBev holds 72.17 per cent majority equity stake in International Breweries Plc through its subsidiary-Brauhaase International Management GMBH. After the business combination, Anheuser-Busch InBev’s majority equity stake will increase to 75.1 per cent.

Under the arrangements for the business combination, International Breweries will issue 5.302 billion ordinary shares of 50 kobo each to shareholders of Intafact and Pabod. Intafact has total issued shares of 1,400 ordinary shares of N100,000 each while Pabod has 4.0 billion ordinary shares of N1 each.

The share exchange ratio indicates that 29.09 million ordinary shares of International Breweries will be exchanged for 10 ordinary shares of Intafact while 3,071 ordinary shares of International Breweries will be exchanged for 10,000 ordinary shares of Pabod.

SABMiller Nigeria Holdings BV-a subsidiary of Anheuser-Busch InBev holds 75 per cent and 82.81 per cent majority equity stake in Intafact and Pabod respectively. Ministry of Finance of Anambra State holds 10 per cent equity stake in Intafact while Ministry of Finance Incorporated of Rivers State holds 14.52 per cent equity stake in Pabod.

After the merger of the three companies-SABMiller Nigeria Holdings BV and Brauhaase International Management GMBH-two subsidiaries of Anheuser-Busch InBev, will hold 47.4 per cent and 27.7 per cent equity stake respectively in International Breweries, giving the foreign majority core investor controlling equity stake of 75.1 per cent. Ministry of Finance of Anambra State will hold 4.7 per cent equity stake while other minority shareholders will hold the remaining 20.2 per cent equity stake.

The boards of directors and management of the three companies said the business combination 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 economy.

According to the proponents of the merger, the business combination will create economies of scale as the proposed merger is expected to generate both revenue and cost synergies, enhanced operational efficiencies, better resource management and more streamlined operations.

The business combination will also encourage further investments that will impact positively on the immediate operating environment and the Nigerian economy generally. With the listing of the scheme shares, shareholders of Intafact and Pabod will be able to trade their shares on the Nigerian Stock Exchange (NSE).

The merger is believed to be a major competitive move by Anheuser-Busch InBev to give its operations a major nationwide push to increase its market share. International Breweries is located in Ilesa, Osun State in the South West region. Intafact Beverages’ brewery is ssituated in Onitsha, Anambra State in the South-East region while Pabod Breweries is located in Oginigba, Port Harcourt, Rivers Sate in the South-South region.

World’s Largest Brewer Anheuser-Busch InBev Consolidates Nigeria Holdings In 3 Way Merger

Abuja, Nigeria. Sept 7th. Nigerian regulatory bodies, the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) have granted pre-merger approvals to the proposed combination of three businesses via scheme of merger of International Breweries Plc (IBPlc) and two other brewing companies Intafact and Pabod all indirect subsidiaries of the world’s largest brewer, Anheuser-Busch InBev (“AB InBev”) (Euronext: ABI, NYSE: BUD, MEXBOL: ANB, JSE: ANH), headquartered in Belgium . A regulatory filing on Tuesday by International Breweries Plc with the Nigerian Stock Exchange, revealed that under the terms and conditions of the proposed scheme of merger, all the assets, liabilities and undertakings of lntafact and Pabod, including employees, real property and intellectual property rights, will be transferred to IBPlc upon completion of the proposed merger.

The statement advised shareholders that the consideration to shareholders of Intafact and Pabod will be ordinary shares of lBPIc

It added that the share exchange ratio, as well as other terms and conditions of the proposed merger are provided in the scheme of Merger Document which will be dispatched to all shareholders of IBPlc, Intafact and Pabod upon receipt of an order from the Federal High Court (“FHC”) to convene separate Court-Ordered Meetings of the merging companies.

IBPlc also noted that the completion of the proposed merger is subject to the approval of the respective shareholders of lBPlc, lntafact, and Pabod and the final regulatory approvals from SEC, The NSE, Federal Inland Revenue Service, as well as the sanction by the FHC.

International Breweries Plc is an Ilesha, Nigeria based company engaged in brewing, packaging and marketing of beer, alcoholic flavored/non-alcoholic beverages and soft drinks

Intafact Beverages Limited produces and markets beer, Hero Lager. The company is based in Onitsha, Nigeria. Intafact Beverages Limited operates as a subsidiary of SABMiller plc.

Pabod Breweries Limited engages in the manufacture, distribution, and sale of beer. The company was incorporated in 1978 and is based in Port Harcourt, Nigeria.


Photo: Inside Anheuser-Busch InBev Brewery Leuven Belgium

All three companies are indirect subsidiaries of the world’s largest brewer, Anheuser-Busch InBev, so the merger is a consolidation of it’s Nigerian businesses as it braces to challenge the dominance of Heineken’s Nigerian Breweries and Diageo’s Guinness Nigeria in Africa’s largest economy. Anheuser-Busch InBev had recently indicated it plans to invest $400 million in establishing a major brewery in Nigeria.

Anheuser-Busch InBev is a publicly traded company (Euronext: ABI) based in Leuven, Belgium, with secondary listings on the Mexico (MEXBOL: ANB) and South Africa (JSE: ANH) stock exchanges and with American Depositary Receipts on the New York Stock Exchange (NYSE: BUD). The company diverse portfolio of well over 500 beer brands includes global brands Budweiser, Corona and Stella Artois; multi-country brands Beck’s, Castle, Castle Lite, Hoegaarden and Leffe; and local champions such as Aguila, Antarctica, Bud Light, Brahma, Cass, Chernigivske, Cristal, Harbin, Jupiler, Klinskoye, Michelob Ultra, Modelo Especial, Quilmes, Victoria, Sedrin, Sibirskaya Korona and Skol. Anheuser-Busch InBev brewing heritage dates back more than 600 years, spanning continents and generations. From it’s European roots at the Den Hoorn brewery in Leuven, Belgium. To the pioneering spirit of the Anheuser & Co brewery in St. Louis, US. To the creation of the Castle Brewery in South Africa during the Johannesburg gold rush. To Bohemia, the first brewery in Brazil. Anheuser-Busch InBev has approximately 200,000 employees based in more than 50 countries worldwide.

For 2016, AB InBev’s reported revenue was 45.5 billion USD (excluding JVs and associates).

Author

Ike Obudulu

Ike Obudulu

Versatile Certified Fraud Examiner, Chartered Accountant, Certified Internal Auditor with an MBA in Finance And Investments who has both worked for and consulted with some of the world's largest companies on main street and wall street in over 20 countries, Ike brings his extensive reporting and investigations experience to bear on his role as Chief Editor.
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