Guinness Nigeria has announced that is has acquired exclusive distribution rights to the international premium spirits brands of Diageo plc in Nigeria. Diageo is Guinness Nigeria Plc’s majority shareholder and had indicated an intention to increase its stake in the company to 70%.
The company announced that it will also take over various assets including the current inventory of Diageo Brands Nigeria Limited, the wholly-owned Diageo business which currently distributes and markets the IPS brands in Nigeria. The consideration for the transaction is approximately N2.35b.
The transaction is expected to be concluded by 31 December 2015 and the new distribution
agreement for the IPS brands will become effective on 1 January 2016 subject to receiving all
Diageo brands in Nigeria includes the Johnny Walker brands Blue, Black, Red; Baileys, Smirnoff Vodka, Gordons, Tanqueray etc. Guinness premium stout brands has seen margins drop as Nigerians increasingly shift their drinking preference to herbal drinks and spirits. Guinness responded with Orijin which has largely been a success. By acquiring Diageo’s spirit distribution rights it is positioning itself to corner one the largest growing alcohol beverage segments in the country.