‘ǼLEX Behind Acquisition of CHI’s Equity Stake by Coca-Cola’

Nosa Alekhuogie

One of the leading law firms, ǼLEX, provided all the legal advisories need for the recent successful completion of the acquisition of a 100 per cent stake in one of Nigeria’s foremost fruit juice and drinks manufacturers, C.H.I. Limited, by the world’s largest beverage company, Coca-Cola Company, THISDAY has learnt.

ǼLEX, it was gathered, advised on all aspects of the transactions, covering transaction structure, drafting and negotiating the share purchase agreement, shareholders’ agreement, intellectual property agreements and ancillary documents, and providing general legal assistance as required.

 It also assisted in obtaining the approval of the Securities and Exchange Commission (SEC) to the transaction, as required in acquisitions of a controlling interest.

A statement made available to THISDAY at the weekend, revealed that the ǼLEX team was led by Theophilus Emuwa and Chinyerugo Ugoji with support from Tiwalola Osazuwa, Damilola Ogedengbe drawn from  the Mergers and Acquisition, Regulatory Compliance and Tax Practice Groups of the firm.

The transaction was structured as an initial acquisition of 40 per cent in 2016 and a subsequent acquisition of the remaining 60 per cent of the issued share capital.

It was also gathered that the agreement created a strategic partnership between two beverage industry leaders that together serve Nigeria’s most popular sparkling soft drinks, juices, value-added dairy and water beverage brands.

The President of the West Africa business unit of Coca-Cola, had said they managed the engagement with the SEC regarding all aspects of Coca-Cola companies’ application for approval, including a robust engagement regarding the potential effects of the deal on competition in the relevant beverage markets.

“Coca-Cola is continuing to evolve as a total beverage company, and Chi’s diverse range of beverages perfectly complements our existing portfolio, enabling us to accelerate expansion into new categories and grow our business in Africa.”

On his part, the team leader of AELEX, Emuwa, recalling the experience of the law firm in transactions of similar nature, remarked: “Our work in this transaction follows the mode of our work on other major transactions in the beverage industry, which include advising Nampak, Africa’s biggest packaging firm, on its US$ 301 million successful acquisition of a Nigerian beverage can manufacture company as part of its expansion drive in the region and advising Castel in relation to its strategic alliance with SABMiller.”

He added: “We are delighted to have supported The Coca-Cola Company in the preparation, submission and follow up of its application, and successfully obtaining the approval of, the Securities and Exchange Commission, a function that, until now, was typically reserved for investment bankers.”

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