Affelka to buy major stake in 7UP

Seven-Up Bottling Company has received an offer from its majority shareholder, Affelka, to buy out minorities for N19.33 billion ($60 million), in a takeover deal aimed at restructuring the struggling company.
Privately-held Affelka, an investment firm of the Lebanese El-Khalil family, has offered to acquire 171.5 million shares from minorities at N112.70 per share, an 18 per cent premium to a share price of N95.50.
Affelka already owns 73.2 per cent of the bottler, set up 57 years ago, and has the licence to bottle PepsiCo’s Pepsi and other products in Africa’s most populous nation.
The soft drinks’ bottling industry has been hit by slow demand arising from weak economic growth in Nigeria, Africa’s most populous nation, which has just emerged from a recession and a currency crisis which stifled raw material imports.
“As of now, we have received an offer from the majority shareholder of the company. It’s a financial restructuring,” Seven-Up vice chairman, Sunil Sawhney, said.
According to him, the company has been making losses for some time and the deal was aimed at restructuring the bottler, which distributes PepsiCo’s 7up, Pepsi and Mirinda-branded drinks.
Shares in the soft drinks maker, which opened for trade at N92.50, rose five per cent on the news, valuing the company at N59.6 billion ($186.25 million).
The Seven-Up takeover deal comes six years after main rival, Coca-Cola, delisted its local bottling unit in a buyout deal worth $136 million, to expand the business and fend off competition.