Guinness’ Parent Diageo Pulls The Plug On Nigeria As Brewery Giant Exits Amid Economic Turmoil

In a move that marks the end of an era, Guinness has announced its exit from Nigeria after 75 years, selling its controlling shares to Singaporean conglomerate Tolaram Group.

BIGPEN NIGERIA (https://bigpenngr.com) reports that the decision comes as the brewery giant struggles to stay afloat amidst economic challenges that have seen its profits plummet by 1,000% in just a year.

Agency report says the brewery brand recorded a staggering N61.9 billion loss after tax between July 2023 and March 2024, just a few months after President Bola Tinubu floated the naira in an effort to unify the currency’s value on the official and parallel foreign exchange markets.

The move was said to have backfired and ostensibly caused many multinational companies to suffer huge financial setbacks including Guinness Nigeria whose N61.7 billion loss after tax in Q3 was a 1,000 per cent decrease from the N5.9 billion profit generated in the same period last year.

“We’re excited to announce our new partnership with Tolaram, said Debra Crew, Diageo CEO, Guinness parent company.

Guinness has been Nigeria’s favorite beer for nearly 75 years.

“Tolaram shares this passion for Guinness and for Nigeria, making them the perfect partners as we continue to grow our business and seek to delight even more consumers in the country,” said Debra Crew, Diageo CEO.

“The transaction is expected to be completed during fiscal 2025, subject to obtaining the requisite regulatory approvals in Nigeria,” said the statement signed by Abidemi Ademola, Guinness’s legal director.

Continuing, the statement said; “Under the terms of an agreement signed today, 11 June 2024, Tolaram will acquire Diageo’s 58.02% shareholding in Guinness Nigeria royalty agreements for the continued production of the Guinness brand and its locally manufactured Diageo ready-to-drink and mainstream spirits brands.”

The sale, expected to be completed by 2025, will see Tolaram acquire a 58.02% majority stake in Guinness Nigeria, with Diageo retaining ownership of the Guinness brand, which will be licensed to Guinness Nigeria for the long term.

Guinness Nigeria Plc, a public limited liability company quoted on the Nigerian Stock Exchange, was incorporated on April 29, 1950, as a trading company importing Guinness Stout from Dublin.

The Guinness brand has operated in Nigeria since 1950, but with Tolaram’s controlling stake acquisition expected to conclude by 2025, the global brewery brand will have spent 75 years in Nigeria.

Diageo’s exit adds to a long list of other multinational companies, like GlaxoSmithKline and Microsoft, that have left Nigeria in the last one to two years, citing the harsh economic climate as making business unprofitable.

Some of Diageo’s popular brands in Nigeria include Smirnoff Ice, Smirnoff Vodka, Orijin Bitters, Malta Guinness, Gordons Orange Sunset, and Dubic Malt.