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Guinness Nigeria’s shareholders approve N40b rights issue

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Shareholders of Guinness Nigeria Plc on Tuesday approved the plan by the company to raise N40 billion in new equity funds.

At the extra-ordinary general meeting in Lagos, shareholders approved the board of directors’ plan to undertake a rights issue of some N40 billion and passed other resolutions authorising the directors to take all necessary actions for the success of the new supplementary issue.

Rights issue is usually offered to existing shareholders at considerable discount to the fair value of the shares. The shares will be allotted to shareholders on the basis of existing shareholdings.

The company had announced at the end of 2016 its intention to offer a rights issue as part of plans to optimize its balance sheet and improve its financial flexibility.

Speaking at the meeting, Babatunde Savage, Chairman, Guinness Nigeria Plc, noted that Guinness Nigeria has been in the country for over 60 years during which it has continued to add significant economic and social value to Nigeria and Nigerians.

“We believe this rights issue will positively impact on the financial performance of Guinness Nigeria and help mitigate the impact of increasing finance costs in what continues to be a challenging economic environment in Nigeria. I call on all my fellow shareholders to take this opportunity and support the company’s objectives,” Savage said.

Read also: Guinness Nigeria’s shareholders meet on N40b rights issue

Also speaking at the meeting, Peter Ndegwa, Managing Director, Guinness Nigeria Plc said that the company has good fundamentals and potentials for the future.

“This rights issue in combination with our productivity and cost optimization drive will help provide the fuel to continue to build this business for Nigeria and Nigerians,” Ndegwa said.

Guinness Nigeria, a subsidiary of Diageo Plc, was established in 1960 and shareholders base of over 70, 000 local and international shareholders.

Guinness Nigeria last year became the first total beverage company when it acquired rights to distribute international premium spirits like Johnnie Walker and Baileys in Nigeria in January 2016 and later commissioned a spirits line for locally manufactured spirits at its Benin plant in November.

This week, the company is also expected to release its first half results for the 6-month period ended 30 December 2016.

 

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