Guinness Nigeria, a subsidiary of Diageo Plc, has announced its intention to exit the Nigerian market after 75 years of operation in the country. The company has agreed to sell its majority stake to the Tolaram Group, a Singaporean conglomerate.
Reason for Exit:
The exit is attributed to the harsh economic climate in Nigeria, which has resulted in significant financial losses for the company. The company reported a loss of N61.9 billion after tax between July 2023 and March 2024, a 1,000% decrease from the previous year.
Terms of the Agreement:
Under the terms of the agreement, Tolaram will acquire Diageo’s 58.02% shareholding in Guinness Nigeria, and Diageo will retain ownership of the Guinness brand, which will be licensed to Guinness Nigeria for the long term.
Completion of the Transaction:
The transaction is anticipated to be finalized in fiscal 2025, pending the necessary regulatory approvals in Nigeria.
Impact on the Nigerian Market:
The exit of Guinness Nigeria from the market is expected to have a significant impact on the Nigerian economy, as it is one of the largest beverage companies in the country. The company’s departure will also lead to job losses and a decline in economic activity.
Other Multinational Companies That Have Exited Nigeria:
Guinness Nigeria is not the only multinational company to exit Nigeria in recent years. Other companies, such as GlaxoSmithKline and Microsoft, have also left the country due to the harsh economic climate.
Popular Brands:
Among Diageo’s well-known brands in Nigeria are Smirnoff Ice, Smirnoff Vodka, Orijin Bitters, Malta Guinness, Gordon’s Orange Sunset, and Dubic Malt.
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