Nigerian Breweries’ CEO addresses acquisition plans and other issues

The Chief Executive Officer of Nigerian Breweries Plc, Jordi Bel, has disclosed the company’s expansion plans for the next few years.

According to him, while Nigerian Breweries Plc seeks to expand its footprint, the company won’t be adopting inorganic growth method.

What’s inorganic growth? It is the use of mergers, acquisitions, and take-overs to increase or speedup growth in a particular sector or market. For Bel, taking that route isn’t part of the company’s growth plan in the short-term.

NB’s growth plan: The CEO spoke to Nairametrics on the sidelines of the company’s annual general meeting held in Civic Center, Victorial Island, Lagos, stating that the company is always open to growth opportunities. However, to expand, it intends to depend on its resources and portfolio.

“WE ARE A BEER AND MALT BUSINESS MAINLY. WE HAVE A SOFT DRINK OPERATION, WE HAVE READY-TO-DRINKS.

“WE WOULD ALWAYS BE OPEN TO OPPORTUNITIES, BUT TODAY, WE HAVE THE RIGHT BREWERIES, THE RIGHT FOOTPRINT, THE RIGHT BRANDS. I THINK THERE’S A LOT OF GROWTH WE CAN DELIVER WITH OUR OWN ASSETS, WITHOUT THE NEED TO LOOK AT ANY INTEGRATION.

“SO, FOR THE TIME BEING, WE ARE LOOKING AT HOW DO WE EXPAND OUR OWN REVENUE, OUR OWN VOLUME WITH OUR OWN ASSETS AND BRANDS.”

NB’s acquisition/merger history: Despite having no plans to acquire or merge with any company to accelerate its expansion across Nigeria, Nigerian Breweries Plc has a history of inorganic growth.

  1. Nigerian Breweries Plc acquired majority shares interests in Sona Systems Associates Business Management Limited (Sona Systems) and Life Breweries Limited from Heineken N.V. in October 2011. This was after Heineken had previously acquired controlling interests in five breweries in Nigeria from Sona Group in January 2011.
  • Sona Systems and Life Breweries, therefore, become part of Nigerian Breweries Plc. They came on board with its three brands: Goldberg lagerMalta Gold and Life Continental lager.

2. Nigerian Breweries merged with Consolidated Breweries Plc on December 31, 2014, adding three breweries in Ijebu-Ode, Awo-Omama, and Makurdi to the company, alongside three brands: 33 Export LagerWilliams Dark AleTurbo King StoutMore LagerBreezerHimalt, and Maltex (the first Nigerian malt drink).

Rumours of counterfeiting: Bel told Nairametrics that rumours about the counterfeiting of its product were untrue, stating that such a claim is being perpetuated by persons with bad intentions. He further argued that it is financially unreasonable for beer or malt products to be counterfeited in the market.

Note that there was a claim, last year, that Amstel Malta had been counterfeited. This sparked fear among the product’s consumers. However, Nigerian Breweries Plc refuted the claim, stating that the confusion rose from the rebranding of Amstel Malta which saw the change of the NIS logo on the product.

Why beer/malt cannot be counterfeited: According to Bel, the values of beer and malt are not very high. Therefore, faking such products is not worth the stress.

“IN BEER, THERE’S NO MUCH COUNTERFEITING, YOU KNOW THE COST OF FAKING A BEER IS NOT REALLY WORTH IT. THE VALUE OR UNIT OF BEER IS NOT VERY HIGH OR A MALT.”

He also assured consumers that all products of Nigerian Breweries Plc in the market are real and not counterfeit.

Source: Nairametrics

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