East African Breweries Limited (EABL) has issued a precautionary statement to its shareholders over its intentions to purchase 30 percent shares in Serengeti Breweries limited.
The statement was issued on Friday for a proposed acquisition of the additional shares in Serengeti. The regional beer maker had earlier purchased four percent shares from Serengeti, it’s subsidiary.
“EABL intends to enter into a conditional transaction to purchase an additional 30 percent shareholding in Serengeti Breweries Limited.” Reads a statement in part.
Members of the public and shareholders in EABL have, however, been advised to be cautious while dealing in shares of the largest brewer in East Africa.
“Shareholders of EABL and the public are advised to exercise caution when dealing in shares of EABL.”
In late January this year, EABL spent $3 million to acquire a four percent stake in Serengeti Breweries Limited, raising its ownership in the Tanzanian subsidiary.
The deal was disclosed by EABL’s parent company Diageo Plc and was completed in July last year following the approval from Tanzania’s Fair Competition Commission.
Prior to the latest disclosures of 4 percent acquisition, EABL had announced that Serengeti’s minority investors were to inject additional capital of Ksh3.2 billion ($32 million) into the company.
In June 2018, EABL converted the Ksh15.3 billion ($150 million) loan to Serengeti to ease the Tanzanian company’s debt burden.
This saw its stake in the subsidiary rise from the previous 51 percent to 72.5 percent.
