Guinness Overseas plans for a partial tender offer at a price of N175 per share in cash


By Benjamin Ameh
In cash tender offer to company stockholders in exchange for their shares at higher than its present market value can offer investors attractive returns and rewarding indeed

Guinness Nigeria PLC has proposed tender offer of to 236,176,604 Ordinary Shares of 50 kobo at N175.00 higher than closed present market value of N152.19 per share representing N22.01

Guinness Nigeria Plc (‘’Guinness Nigeria on NSE’’) notified The Nigerian Stock Exchange that Diageo Plc. (“Diageo”), acting through its wholly owned subsidiary Guinness Overseas Limited (“Guinness Overseas”), has approached the Board of Directors of the Company with an intention to make an offer to increase Diageo’s equity stake in the Company from 54.3% up to a maximum of 70% valued up to 236,176,604 Ordinary Shares of 50 kobo and to maintain the Company’s listing on The Nigerian Stock Exchange.

If Diageo decides to proceed with the proposed transaction, it is intended that, subject to regulatory approval, Guinness Overseas will launch a partial tender offer at a price not higher than NGN 175 per share in cash, giving all shareholders the opportunity to elect to sell some or all of their shares in the Company.

At the maximum offer price, the proposed offer would represent a premium of 36 per cent to the 30-day volume weighted average share price and 40 per cent to the Company’s closing share price on 8 September 2015.

Guinness Overseas may also seek to acquire shares in the market at a price not higher than the offer price of NGN 175 per share. Diageo would encourage those shareholders that wish to divest their holdings in Guinness Nigeria to make contact with Stanbic-IBTC Stockbrokers Limited.

Furthermore, the statement disclosed that today’s announcement is of Guinness Overseas’ intention and does not constitute the announcement of an offer itself and creates no obligation on Guinness Overseas or Diageo to make an offer.

Accordingly, the management wishes to advise the shareholders of Guinness Nigeria that there can be no certainty that any offer will be made, nor as to the price or terms of any offer that may be made. Further developments will be communicated to shareholders in due course.

The proposed partial tender offer will be subject to requisite regulatory approvals, including those of the Nigerian Stock Exchange and the Securities and Exchange Commission. The formal offer documentation will be posted to shareholders as soon as these approvals are obtained.
Guinness Nigeria Plc at this weekend opened market at N128.00 per share, then closed at N152.19, with an increase of N24.19 represents 18.90 percent which makes it the second richest stock on the floor of the NSE.

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