Regulators clear Guinness Nigeria to raise N39.7bn Rights Issue

Guinness Nigeria Plc has received clearance from Securities and Exchange Commission (SEC) and approvals from the Nigerian Stock Exchange (NSE) to list N39.7 billion Rights Issue.
Shareholders of the multinational brewery company In January approved N39.7 billion Rights Issue exercise.
If successfully raised, the funds will support the company in executing its strategy in the context of ongoing external economic challenges.
The company plans to raise N39.7 billion by way of rights to existing shareholders, on the basis of 5 new shares for every 11 shares held by shareholders, whose names appeared in the register of members of the Company as at March 15, 2017 at an issue price of N58 per share.
The issue price represents a discount of 15 per cent to the Company’s closing share price on March 14, 2017, being the last day prior to the announcement of the proposed Rights Issue by The NSE.
Commenting, Managing Director of Guinness Nigeria Plc, Peter Ndegwa, said “This Rights Issue will allow the Company to deliver on its strategic objectives and give all our shareholders a unique opportunity to increase the number of shares they hold. 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, the compny chairman stated that the process was part of the Company’s long term plans to continue to invest in its business in Nigeria, commenting, “We have been here 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 other stakeholders up to this point.”
Last year, Guinness Nigeria Plc became the first total beverage alcohol company in Nigeria by acquiring the rights to distribute international premium spirits like Johnnie Walker whisky and Baileys liqueur in Nigeria and later commissioning a N4.7billionspirits line for locally manufactured spirits at its Benin plant.
Guinness Nigeria has also been a champion for community development recently. Leveraging its flagship ‘Water of Life’ scheme, the company has delivered 35 water facilities across 24 states in Nigeria. These facilities have helped provide clean drinking water for over 1.5 million Nigerians.
The Company urged investors to read the Rights Circular and where in doubt, consult their Stockbroker, Fund/Portfolio Manager, Accountant, Banker, Solicitor, or any other professional adviser for guidance before subscribing.