By Peter OBIORA investadvocate

Lagos (INVESTADVOCATE)-A Panamanian Firm, Montgomery Ventures Incorporated of Panama is to sell its 57 percent (57%) equity stake in Champions Breweries Plc to Consolidated Breweries Plc.

Champion Breweries Friday April 15 2011 announced this through a notice to the Nigerian Stock Exchange (NSE) in Lagos Nigeria.

The Brewing Company affirmed in the notice to the NSE that Consolidated Breweries Plc is having discussions in connection with a proposed acquisition of 57% of the issued share capital of Champion Breweries Plc held by Montgomery Ventures Incorporated of Panama.

Champion Breweries affirmed that if the discussion is successful, it could lead to a transaction that will be subject to the relevant legal and regulatory approvals and will notify the Stock Exchange as it becomes aware of further details.

From investigations by investadvocate, Montgomery Ventures Incorporated of Panama with Offices in Geneva, Switzerland was identified as a Core Investors/Technical Managers; who bought into Champions Breweries in year 2000; following a Memorandum of Understanding (MOU) it signed with the Akwa Ibom State Investment and Industrial Promotion Council (AKIIPOC) charged with the responsibility of reactivating Champion Breweries by the Government of Akwa Ibom State in May 1999.

This came as a pressure in the demand of the product of Champions Breweries and the decision for the Brewing Firm to double its capacity to one million hectoliters; which working capital was needed to execute.

Based on the Memorandum, a Reactivation Committee was set up by the Board of Champion Breweries to work with Montgomery Ventures Incorporated to revamp the Brewing Company.

According to investadvocate research, the reactivation process, commenced in February year 2000 and lasted about 19 months.

Champion Breweries ahs said that the Plant has been revamped and restructured to use 100% locally sourced raw materials. “The Brewery is now fully operational and the capacity is 500,000 hectoliters per annum (PA)” the Firm said.

This is coming on the heels of the proposed delisting from the Nigerian Exchange by Nigerian Bottling Company (NBC) bottlers of Coca Cola; another Foreign Firm.

On 14 Tuesday December 2010, NBC shocked the Nigerian Capital Market (NCM) Community when it announced through a notice to the Nigeria’s Exchange that it is planning to emerge a wholly owned subsidiary of its majority shareholder, Coca-Cola Hellenic Bottling Company of South Africa through a proposed scheme of arrangement.

NBC said the proposed Scheme of Arrangement will be between it and its members; which will involve a cancellation of part of NBC’s Share Capital, such that the Company would emerge a wholly owned subsidiary of Coca-Cola Hellenic of South Africa.

According to the bottlers of Coca-Cola in Nigeria, the proposed Scheme would be effected under the provision of S539 of the Companies and Allied Matters Act (“CAMA”), which allows for an arrangement to be proposed between a Company and its members.

However, this move by NBC has been challenged by mostly its minority shareholders; who affirmed that the idea of delisting from the Nigeria’s Exchange is not in their interest and that of the Nation’s Stock Market.

As earlier reported, the Chartered Institute of Stockbrokers (CIS) through its President Michael Itegboje; totally condemned the action by Cocao-Cola Hellenic Bottling Company, to buyout the minority shareholders that have sustained the Firm these past years.

“It is not a good omen at this point in time that the Stock Market is revamping with expectations of shareholders to reap the dividends of their investments over the years; that the Greek Owners of the Bottling Company to now want to dump those who made them; over flimsy and unacceptable reasons” the CIS President said.

investadvocate has observed that after the Tuesday 14 2010 notice to the Stock Exchange on the reason of the Company’s plan to emerge a wholly owned subsidiary of its majority shareholder, Coca-Cola Hellenic Bottling Company of South Africa through a proposed scheme of arrangement; by delisting from the NSE.

NBC following pressures from stakeholders after a few weeks changed the above reason for delisting and came up with another development that the reason they want to delist from the Nigeria’s Exchange is for the company to take advantage of the emerging business opportunities in Nigeria and do a N45 billion investment within the next three years and recapitalise.

NBC told Nigerian Shareholders in meeting they held January in year 2011 that they (Nigerian Shareholders) cannot wait for a period of between 10 to 15 years when the company may likely resume the payment of dividend; following its plans to reinvest whatever profit they realised from the strategic investments in the period in view to the operations of the company; therefore opted to delist and buyoff minority shareholders.

Now, another foreign firm is planning to sell off a significant 57% equity stake it has in Champions Breweries a Company operating on the Breweries Sector of the Nigeria’s Exchange.