Guinness Nigeria to sell 684 million shares in via rights issue

Baker Magunda

Guinness Nigeria PLC, the country’s second largest brewer said it will sell a total of A total of 684,494,631 ordinary shares of 50 kobo each will be offered to existing shareholders for its previously announced rights issue.

The company said in a statement that the issue will be in the ratio of five new ordinary shares for every eleven ordinary shares held by shareholders whose names appeared on the register of members of the Company at the close of business on Wednesday, 15 March, 2017.The issue price is N58 per share. Stanbic IBTC Capital Limited is the issuing house to the offer which opened on Monday 24 July, 2017 and will close on Wednesday 30 August, 2017.

The net proceeds of the Issue, already approved by the Securities and Exchange Commission and Nigerian Stock Exchange, will help the company repay outstanding loan obligations, improving the operational and financial flexibility of the Company. At its Extra-ordinary General Meeting in January 2017, shareholders of the company had authorized the Board of Directors to proceed with the Issue.

Peter Ndegwa, chief executive of the company said the “issue will allow the Company to deliver on its strategic objectives and give all our shareholders a unique opportunity to increase their shareholding in the company. Our expectation is that funds raised will help mitigate the impact of increasing finance costs, optimize our balance sheet and improve the Company’s financial flexibility.”

Babatunde Savage, Chairman, Guinness Nigeria Plc, stated that this process is part of the Company’s long term plans to continue to invest and return to profitability, commenting “We have been in Nigeria for 67 years and, while it has been challenging in recent times for many Nigerian businesses, we remain committed to this market as evidenced by our decision to offer this Rights Issue. We are grateful for the support that we have received from our shareholders and various other stakeholders up to this point.”

Stanbic IBTC Capital Limited is acting for Guinness Nigeria Plc is advising Guinness Nigeria in the transaction.

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