Nigeria’s Second-best Performing Stock to be Acquired by London-based Helios Investment

Frigoglass Industries and Frigoinvest Nigeria hold 61.9 per cent and 8.2 per cent interests respectively in the glass container maker.

Talks to take over Beta Glass, Nigeria’s second best-performing stock this year, by a new majority owner, Helios Investment Partners, has been completed with a deal reached to consummate the transaction at $100 million.

Frigoglass Group, the majority shareholder, closed the deal with the London-based private equity firm, with the understanding that cash settlement will follow latest by next March, Beta Glass announced Tuesday.

It will sell “the entirety of its shareholding in Frigoinvest Nigeria Holdings B.V, the holding company of its Nigeria glass business and Frigoglass Industries Nigeria Limited,” the company said in a regulatory filing.

Frigoglass Industries and Frigoinvest Nigeria hold 61.9 per cent and 8.2 per cent interests respectively in the glass container maker, putting the potential stake to be snapped up by Helios at 70.1 per cent.

Africa-focused Helios Investment is buying Frigoglass’ stake on behalf of the funds to which it provides advisory services.

Its investment interest included fintechs, digital infrastructure and tech-driven businesses, the information on its website shows.

The acquisition needs a nod from regulators to fly, and plans are in place for Beta Glass to help the acquirer through the regulatory approval process to ease transition.

Market performance

Traders have been piling into Beta Glass’ shares since April, when the release of its first quarter accounts showed that after-tax profit soared nearly seven times to N10 billion, compared a year earlier.

That helped bring the stock, which until then had been in obscurity, to increased investors’ attention.

With year-to-date yield at 531 per cent, it is so far this year Nigeria’s best-performing stock after NCR Nigeria.

Return on equity January through September stood at 30 per cent, compared to 12.8 per cent in the same period of last year.

Bloomberg, citing an interview with Frigoglass’ chair, Gagik Akparian in September, reported that the company wanted to divest from Beta Glass so it can use the proceeds to repay maturing senior secured bonds.

The strong profit performance of the company, which is West and Central Africa’s biggest glass container producer, makes it a strong attraction to buyers, according to the chairman, the news outlet said.

Francophone Africa’s expansion push

In February, Beta Glass unveiled plans to extend its footprints in French-speaking African countries.

As of then, its reach, apart from its base Nigeria, where it runs two glass manufacturing plants, spanned at least twelve export markets on the continent.

It is committing €17.5 million to scale-up plans in the West and Central Africa region, hoping to ride on the back of Africa Continental Free Trade Agreement to access promising markets.

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“What we’ve done also is looking first to our closest neighbours, a little bit further away, the whole continent, and then anywhere in the world. But first is Nigeria. First. Second is ECOWAS. Third is the whole continent,” CEO Alexander Gandis said.

It produces 650 million glass containers every year. Annual crate production capacity is at 5.5 million units while that of crown is at 3.2 billion units, based on its website data.

The company said it invested N15.3 billion on expanding output capacity in the last five years.