Diageo invests in Nigeria beer capacity

Diageo invests in Nigeria beer capacity

Diageo is set to intensify competition between brewers in Nigeria after announcing that it will spend GBP225m (US$366.6m) to increase brewing capacity in the country.

Diageo will invest the sum, which is set to create 200 new jobs, via its local subsidiary, Guinness Nigeria. It follows the group's launch of a new brewhouse at its Ogba brewery in the country earlier this year.

When questioned by just-drinks, a spokesperson for Diageo declined to disclose Guinness Nigeria's current production capacity, or detail by how much capacity will be increased, sayint that the information is "commercially sensitive".

However, the move is set to intensify competition in a market that has also drawn interest from Heineken and SABMiller.

Guinness Nigeria's MD, Devlin Hainsworth, said that the capacity investment is in response to higher demand for key beer brands, such as Guinness and Harp, in the country. "This investment underscores Diageo’s confidence in Nigeria," said Diageo's president for Africa, Nick Blazquez.

Earlier this year, SABMiller said it would spend US$100m to build a new brewery in Onitsha, in the south-east of Nigeria. Prior to that, Heineken said that it had acquired five breweries in the country. Before the purchases, Heineken's market share was 55% in volume terms.