The revival of M&A as strategy for Nigerian businesses vanguardngr.com vanguardnews
The total value of M&A transactions in Nigeria is over N500 billlion, according to analyst estimate, excluding some fringe mergers and acquisitions. Merger is a deal to unite two or more existing companies into one new, bigger company.
Examples include the acquisition of ConocoPhilips, COP at $1.55 billion by Oando Energy Resources, OER, a subsidiary of Oando Plc now 11 Plc. The acquisition of Mainstreet Bank Limited from Asset Management Corporation of Nigeria, AMCON by Skye Bank Plc for a total consideration of N120 billion and Polaris Bank acquisition of Skye Bank.
However, the Coca Cola acquisition of Chi took the public by surprise, despite the fact that the former had bought 40 per cent of the latter’s shares, with a promise to conclude the final acquisition in three years time, but to the chagrin of distributors and consumers, the deal came earlier than expected.Managing Partner of Rocks Resources, Bruce Akuwara said: “Monopolies give terrible business advantages that do not benefit any free economy.
According to a Manager in one of the superstores in Ikeja who pleaded anonymity: “The coming together of both companies signifies a great advantage for both brands. This will help strengthen the presence of Chi brands in the hinterlands. What this means to us is more great brands to boost our profit in the coming years.”
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