AB InBev boosts Nigeria with Budweiser and investment

Brewing giant AB InBev is boosting its Nigerian operation with a US$250 million new brewery and the launch of its leading brand, Budweiser, in the country.

With reports recently that Budweiser is planning on joining the space race and be the first beer brewed among the stars, the company has set about realising a more Earthbound but immediately tangible goal of establishing the brand in Nigeria in the meantime.

The launch is part of a wider investment that the brewer has planned for the country.

To begin with it is investing $250m in its fourth brewery in Nigeria, which will be the biggest in its portfolio outside of South Africa, and it will merge its three subsidiaries (acquired during its takeover of SAB Miller) – International Breweries, Pabod Breweries and Intafact Breweries – into one.

The merger, which began in June end is due to be complete by the end of the year, will leave just one entity in the end, which will be known as International Breweries under managing director Annabelle Degroot.

Degroot said in a statement: “The merger is on track, we have received all the necessary approvals now through the courts and we intend to list the shares of the new, enlarged company on the stock exchange around mid-December.

“To begin with, the large entity will be known as International Breweries, that’s the company we have currently listed on the stock exchange.”

AB InBev’s investment drive in the region is understandable. Africa and Asia are booming beer markets with huge room for growth in the long term. Nigeria, already a strong market for Diageo’s Guinness brand, was estimated to be worth US$2.7 billion at the end of last year by Euromonitor International and Anheuser Busch has inherited SAB Miller’s well-entrenched network and portfolio as a solid base to build upon.

Despite recent economic turbulence, the forecast is much better for the West African nation with beer volume growth pinned at 4%.