South African company Tiger Brands Ltd, has agreed to sell its 49 percent minority shareholding in UAC Foods Ltd. to parent UAC of Nigeria Plc.
The sale makes Tiger Brands the latest South African business to exit Nigeria, Africa’s most populous nation and largest economy, where economic weakness last year curbed consumer demand, input cost rises have cut into margins and currency volatility has further eroded profits. It is leaving Nigeria about two months after another South African firm, Shoprite Holdings, sold its operations in the West African country to local investors.
The acquisition is expected to be completed in September, UAC of Nigeria said in a filing published on the website of the Nigerian Exchange Group. UAC of Nigeria, which has interests in real estate, paints and livestock feed, currently owns 51% of UAC Food's shares.
Tiger Brands, the producers of All Gold, Black Cat and Koo, acquired a minority state in UAC Foods in 2011, following a joint venture agreement with the Nigerian firm to manufacture and distribute some sausage, ice cream and water brands.
Also, Tiger Brands in 2015 sold its shareholding in Dangote Flour to Nigerian parent Dangote Industries, three years after buying it.