Vectis, a private equity firm long active in Nigeria, has concluded a restructuring investment transaction of USD12 million into Leventis Foods Ltd, an established Nigerian FMCG manufacturing company with leading brands of bread and snacks.
The transaction is pending regulatory approvals. Upon completion Vectis will control a majority stake and AGL will maintain minority.
Bread and flour-based snack sectors emerged in Nigeria over the past years and are expected to have a substantial growth with new products coming on the market. Rising disposable incomes and growing popularity of quality branded snacks will be key growth drivers especially among the young 115 million Nigerians under 25 years old. Annual bread consumption p ca is at 10.5kg vs 40.2kg in S Africa. This translates to a market size of 7.2 million loaves/day or USD2 billion annually. Wheat consumption has grown by 4.5 per cent pa between 2009-2014 and 62 per cent of this goes to bread production. Similar dynamics hold for pastries with current consumption at 22 million units/day.
Leventis Foods started in Nigeria in 2002 and launched the first packaged bread, Val-U bread, which grew to become the best quality product of its category enjoying high awareness in Lagos and the South part of the country. Salty snacks Meaty, Hotty and sweet snacks Diamond Cake, 4me Choco, BOSTON DONUT comprise its portfolio. It operates out of a fully functional 12,000 sq.m. factory and employs 200 people with strong manufacturing knowledge. Furthermore it distributes frozen products through an exclusive cooperation with the US company RICH’s. RICH’s is known globally for more than 70 years as the founder of the Non-Dairy segment of the frozen food industry and leading supplier to the foodservice, in-store bakery and retail marketplaces.
Following this investment, Leventis Foods has a very strong financial position and coupled with its technical know-how will further enhance its product portfolio, manufacturing and logistics infrastructure and distribution. New Board and Management with vast execution experience in Nigeria and Africa will bring the Company to a new level to become the leading flour-based food and snack producer in West Africa.
AGL is a large Nigerian Conglomerate founded in 1937. AGL has played a significant role in the Nigerian economy as a diversified operator and investor. Has acted as the founder of very successful and now independent companies like Nigerian Bottling Company (the local Coca Cola franchise), 33 Beer, Beta Glass, Cummins Nigeria and others. Currently AGL is active in automotive (Volkswagen and Foton trucks) and real estate (portfolio throughout Nigeria).
Vectis is a special situation Private Equity Deal Shop active in SE Europe since 2000 and first came to Nigeria in 2008. It has been working with European institutional investors and has made numerous investments across sectors with combined enterprise value in excess of USD 2billion. Its investments are of long-term nature and sectors of expertise are Financial services, retail and food manufacturing.
Transaction legal advisers are ACAS and Chris Ogunbanjo LP from Nigeria and KGDI from Athens.
