Champion Breweries secures shareholder approval for expansion, compliance measures

NIGERIA – Champion Breweries Plc has gained shareholder approval to issue up to 1,579,058,099 ordinary shares, a move aimed at meeting the Nigerian Exchange Ltd. (NGX) free float requirement. 

This decision was made during the company’s Extraordinary General Meeting (EGM), as announced by the Board Chairman, Mr. Imo-Abasi Jacob.

In addition to the share issuance, shareholders approved the establishment of a bond program valued at N15 billion (US$9.3 million) and a N5 billion (US$3.1 million) Series One issuance. The bonds will be floated through a specially incorporated funding vehicle to strengthen the company’s financial position and fuel its growth strategy.

Jacob emphasized the importance of these resolutions in advancing Champion Breweries’ objectives, including infrastructure upgrades, production capacity expansion, and enhanced operational efficiency.

 “These approvals represent a bold and necessary step for Champion Breweries, as we position ourselves for the next phase of growth,” he stated.

Strategic initiatives for growth

The approved measures are part of a broader strategy to improve market liquidity, achieve compliance with regulatory standards, and solidify the company’s position in Nigeria’s competitive brewing industry. 

Managing Director and CEO, Dr. Inalegwu Adoga, described the decision as a “historic moment” for the company.

“These steps will allow us to enhance our operational capacity and unlock growth opportunities for our stakeholders,” Adoga noted. 

The company’s focus on innovation and operational efficiency is seen as pivotal to maintaining its market leadership and creating long-term value.

The capital raise aligns with Champion Breweries’ recent financial performance. In the third quarter of 2024, the company reported a 67.63 percent increase in revenue to N14 billion (US$8.7 million), up from N8.36 billion (US$5.2 million) in the same period in 2023. Profit after tax during this period was N21.50 million (US$13.4 thousand).

Over the first nine months of the year, sales grew by 68 percent, showcasing the brewery’s adaptability and resilience amid challenging market conditions.

Recent developments and market position

Champion Breweries has also made strides in addressing its free-float deficiency on the NGX, which had previously limited its compliance with exchange requirements. The newly approved share issuance is expected to resolve this issue while also attracting greater market participation.

Earlier in the year, the company underwent a major ownership change when it divested an 86.5 percent stake to EnjoyCorp Limited, signaling the latter’s entry into Nigeria’s beverage industry. 

This move is anticipated to bring additional resources and expertise to Champion Breweries, further enhancing its competitive edge.

The company has also invested in renewable energy and operational upgrades, signaling a commitment to sustainability and efficiency. 

“Our nine-month performance reflects our ability to adapt and grow. Investments in operational efficiency, renewable energy, and market expansion will drive even greater success in the years to come,” Adoga highlighted these efforts.