- Irish Musician Acquires Nigerian Firm for $80m
A private equity firm with interest in agriculture and technology, 8 Miles, on Tuesday acquired minority stakes worth about $80m in the Nigerian biscuit company, Beloxxi Industries Limited.
Irish pop star, Sir Bob Geldof, is the founder of 8 Miles.
The company also bought a minority stake in Blue Skies, an ethical fruit business that looks to expand into Nigeria and neighbouring West African countries.
Blue Skies, which operates in Ghana, Egypt and South Africa, did not disclose the financial details of the transaction.
However, its Chairman and Founder, Anthony Pile, said in a statement that Blue Skies and 8 Miles shared the vision “for improving the lives of people, protecting the environment and making enough money at source to advance our objective to supply best quality products to the people of the world.”
On the Beloxxi deal, the consortium of investors includes Nigeria-based African Capital Alliance and DEG, a subsidiary of the German KfW Development Bank.
Geldof had in August 2016 shown interest in Nigeria’s snacks industry and had sought to invest in Beloxxi, makers of Beloxxi cream cracker biscuits, towards boosting Africa’s biggest economy.
He had said that growth in the snacks market of large cities, such as Lagos, had been strong in recent years, “but the investment comes as the country struggles through the worst economic crisis in decades, driven by low oil prices and worsened by a failing government response that has included capital controls and import restrictions.”
Inflation had soared to more than 16 per cent at the end of 2016 and companies, including Beloxxi, along with multinational giants such as Unilever, had been forced to increase their prices, hitting consumers at a difficult time.
The President and Chief Executive Officer, Beloxxi, Mr. Obi Ezeude, said that before the $80m lifeline, the company reduced its dependence on imported raw materials and was striving to keep the prices of its biscuits affordable for the poorest Nigerian consumers.
Given the market challenges, he said that Beloxxi had been forced to increase the price of its smallest-sized product, a three-biscuit package of 21 grams, to N15.
Ezeude added, “With this equity investment, we will expand our current operations from five production lines to about 10 production lines. That will increase our capacity from 40,000 metric tonnes to 100,000 metric tonnes of Beloxxi cream crackers per year.”
“This is a landmark transaction that demonstrates the capacity for growth in the manufacturing sector in Nigeria. The investment will further increase the capacity of Beloxxi Industries and enable it to explore the export market, accessing the much needed foreign exchange whilst maximising the potential for growth in Nigeria.”