International Breweries moves to convert N595bn AB InBEV loan to equity

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International Breweries

There are plans by International Breweries Plc, one of Nigeria’s leading brewers to convert the loan of $379.9 million, about N595 billion, it took from its parent company, AB InBEV Nigeria Holdings, to equity.

AB InBEV Nigeria Holdings is the majority shareholder in International Breweries Plc, and the arrangement, when it sails through, will help the latter to own more shares in the entity.

A notice signed by the company secretary of International Breweries, Mrs. Marian Reginald-Ukwuoma, informing the Nigeria Exchange Limited about the move, said an Extra-Ordinary General Meeting will be held on April 9, to perfect the process.

The loan is expected to be converted to equity in a Rights Issue which has been approved by the Board of Directors for shareholders to inject fresh capital into the company to enhance its operations.

At the planned EGM ordered by the Board of Directors, approval of shareholder loan and debt-to-equity conversion will be a top priority.

The notice read in part, “That the loan of US$379.9 million granted to International Breweries Plc by AB InBEV Nigeria Holdings BV (‘the Shareholder Loan”) in respect of the repayment of the loan obtained by the Company from Citibank Abu Dhabi be and is hereby approved in accordance with the terms and conditions presented by the Board of Directors.

“Subject to compliance with the applicable regulatory requirements, the Directors be and are authorised to apply any convertible loan, shareholder loan or any other loan amount/facility due to any person from the Company as may be agreed between the person and the Company towards payment for any shares subscribed for in the Rights Issue that has been approved by the shareholders of the Company.”

It is also expected that the directors will be authorized by shareholders to approve, sign and/or execute all documents, and appoint such parties and advisers as may be necessary to give effect to resolutions, including without limitation, complying with the directives of any regulatory authority.

In 2019, IB Plc through a Rights Issue, raised an additional capital of N165 billion for its business operations. ABInBev, injected N124 billion ($341 million) via the Rights issue.