EABL plans to accumulate full possession of Uganda Breweries Restricted

KENYA – East African Breweries Ltd (EABL) has introduced its intention to extend its shareholding in its Ugandan subsidiary, Uganda Breweries Restricted (UBL), by buying the remaining 1.81 % stake.

The Kenyan-based brewer at present holds a 98.19 % stake in UBL.

In a young discover, EABL acknowledged that the provide can be made on a “keen purchaser, keen vendor” foundation, making certain no stress on shareholders who select to not promote their shares.

“If any shareholder doesn’t want to settle for the tender provide and needs to proceed to stay a shareholder in UBL, then such shareholder doesn’t must take additional motion,” the discover clarified.

The tender provide is on the market to all holders of atypical shares as of September 2, 2024, and can shut on March 3, 2025, at 5 pm.

EABL has set the acquisition worth for every atypical share at UGSH5,630 (US$1.51). Ought to the tender provide be absolutely accepted, EABL would purchase 120,471,208 atypical shares, leading to 100% possession of UBL.

EABL’s resolution to pursue full possession of UBL aligns with its broader technique of consolidating its property in key markets.

The corporate additionally holds full possession of Worldwide Distillers Uganda Ltd and East African Maltings (Uganda) Ltd. Uganda stays a vital marketplace for EABL, contributing considerably to its monetary efficiency.

In keeping with EABL’s newest monetary statements, Uganda is the corporate’s second-largest market after Kenya.

Within the monetary yr ending in 2023, EABL reported internet gross sales of KES124.1 billion (US$963.88M), marking a 13 % improve from the earlier yr.

The corporate noticed sturdy development in its spirits class, with a ten % improve, whereas the beer section grew by 12 %.

When it comes to regional gross sales, Kenya accounted for 65 %, adopted by Uganda at 21 %, and Tanzania at 14 %.

EABL’s transfer to accumulate the remaining stake in UBL mirrors the actions of its dad or mum firm, Diageo, which in March 2023 elevated its stake in EABL from 50.03 % to 65 %.

Diageo’s acquisition was executed by way of its subsidiary, Diageo Kenya, and concerned the acquisition of an extra 14.97 % stake, amounting to 118.4 million shares at KES192 9US$1.49) per unit, valuing the transaction at KES22.7 billion (US$176.3M).

The acquisition was accomplished in two phases, each of which have been oversubscribed.