International Breweries’ shareholders endorse loan to drive growth, profitability
By Ralph Tathagata
In a strategic move to drive growth and profitability, shareholders of International Breweries have approved a loan of $379.9m from its majority shareholder, AB InBev Nigeria Holdings BV. The loan is aimed at addressing the company’s debt burden and consolidate its market positioning.
It would be recalled that IB Plc’s loan portfolio amounted to N374.339 billion on 31 December, 2023. A loan of $424m with an outstanding balance of $389.08m (2022: $309m) obtained from Citi Bank in 2018 with maturity date of May 2021 was rolled over for an additional 3-year period, according to the financial statement.
Also, according to its audited results for 2023, IB Plc saw its revenue grow to N260.59bn from N218.65bn at the end of 2022. However, the leading brewer suffered a loss of about N70.03bn on the back of foreign exchange losses.
What’s more, a report from its recent Extra General Meeting of April 15, 2024, stated that the company proposed and received approval for a shareholder convertible loan of US$379.9 million from AB InBEV Nigeria Holdings BV, for the repayment of this loan obtained by the Company from Citibank Abu Dhabi.
The resolutions, filed with the Nigerian Exchange Limited, showed that the shareholders also approved the conversion of the loan to equity in the planned rights issue of the leading brewer.
The resolutions read in part, “Approval of Shareholders Loan: That the convertible loan of $379.9m from AB InBEV Nigeria Holdings BV (‘Shareholder Loan”) in respect of the repayment of the loan obtained by the Company from Citibank Abu Dhabi is hereby accepted and approved in accordance with the terms and conditions presented by the Management of the Company.
“Conversion of the loan to equity: That subject to complying with applicable regulatory requirements, the Directors are authorized to apply all sums due from the Company to AB InBev Nigeria Holdings BV under the Shareholders Loan, towards payment for any shares subscribed for by AB InBev Nigeria Holdings BV in the company’s Right Issue that has been approved by the Shareholders of the Company.”
Earlier in January, the board of directors of IB Plc said it was considering a rights issue and an increase in its share capital.
The issued share capital of the brewer stood at 26,862,069,000 ordinary shares of 50 kobo each as of the end of December 2023.
Brauhaase International Management GMBH and its ultimate holding company (AB InBev Nigeria Holding BV) held an equity interest of 87.29 per cent in the firm.
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