Private equity firm acquires majority stake in Nigeria’s largest bakery business

By Gill Hyslop contact

- Last updated on GMT

Because of the country's massive population, Nigeria's bread market is booming. Pic: ©GettyImages/Rawpixel
Because of the country's massive population, Nigeria's bread market is booming. Pic: ©GettyImages/Rawpixel

Related tags: Nigeria, Bread market, Mergers and acquisitions

Private equity firm Vectis Capital has bought a majority stake in Leventis Foods, Nigeria's largest manufacturer of breads and snacks, for $12m.

The transaction is pending regulatory approvals.

According to Leventis, Nigeria’s bread and flour-based snack sectors are forecast to grow substantially, driven by the growing popularity of snacks among the 115 million Nigerians under the age of 25.

Rising disposable incomes and the increasing availability of new products on the market – both locally produced and imported – are also expected to propel growth.

Massive market for bread

Although annual bread consumption per capita (10.5kg) is small in relation to South Africa (40.2kg), for example, given the size of the population (almost 192 million), it translates to a market size of 7.2 million loaves per day or $2bn annually.

Wheat consumption grew by 4.5% per annum between 2009-2014 and 62% of this goes towards bread production.

Similar dynamics hold for pastries with current consumption at 22 million units per day.

Nigeria’s first packaged bread

Leventis Foods is one of the largest bakeries in Nigeria, best known for launching the country’s first packaged bread, Val-U bread. Other top-selling products in its portfolio include Family Loaf, Wheat Loaf and Midi Loaf, Meaty sausage rolls, Diamond Cake, 4me Choco and Boston Donut, Hotty and Mini Hotty spicy rolls.

The newest addition to its portfolio is Sweet Rolls, available in three variants: Choco, Vanilla and Sweet Bourbon.

It also distributes frozen products through an exclusive cooperation with the US bakery company Rich’s, a 70-year-old family-owned multinational credited as the founder of the non-dairy segment of the frozen food industry.

The Lagos-based company was established Nigerian conglomerate AG Leventis – which founded the Nigerian Bottling Company (a local Coca Cola franchise), among other companies – and Carnac (a holding company based in Cyprus) in 2001.

The company operates out of a 12,000m2 factory in Lagos, employing a skilled workforce of 200.

Vectis’ investment in Leventis will boost its efforts to expand its product portfolio, as well as its manufacturing and logistics infrastructure, and distribution network.

Vectis has been active in Europe since 2000 and in Nigeria since 2008, working on numerous investments across various sectors with combined enterprise value of over $2bn.

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