Necessary documentations have been completed for the investment of over $250million in Nigeria’s fast moving beer industry next year by a South African group, AB INBEV.
AB INBEV is a multinational company, operating in 25 different countries; with well-known brands are Budweiser, Bud Light, or Stella Artois.
Coming with the foreign direct investment is a proposed merger of its three Nigerian subsidiaries; International Breweries Plc, Intafact Beverages Ltd., and Pabod Breweries Ltd.
Explaining the deals at a media briefing recently in Lagos, the Managing Director Designate, International Breweries Plc, Mrs Annabelle Degroot, said the facility, which would be located in Sagamu, Ogun State, will attract Foreign Direct Investment (FDI) into Nigeria, and increase job creation.
Currently, International Breweries, which is a listed company, has 1.5 million hectolitre capacity, while Intafact beverages based in Onitsha, Anambra State, has a capacity of 2.7 million hectolitre, and Pabod Breweries, Port Harcourt, Rivers State, has 1.5 million hectolitres capacity.
She said “We are investing in a large brewery outside of Lagos, and it is our largest in Africa, outside South Africa. It is over $250million investment facility. We have decided that running these three companies individually has not been as efficient as it can.
“We have reached a size where it makes sense now for us to merge these companies together, and act as one larger corporation in Nigeria. The Board of Intafact and the other two companies welcome it.”
Industry pundits say the new inflow will among other things jerk up job creation and up competition in the already saturated Nigerian beer industry.
The federal government will be the highest gainer as government currently earns more money from VAT paid by breweries.
However, a confusing scenario in beer VAT collection and disbursement by the federal government is that whereas some northern states have banned sales of the products, they are also collecting shares from VAT earned from the sales in other states that allow liquors’.
