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8 Miles, ACA and DEG back Beloxxi in $80mln deal

Africa-focused private equity firms 8 Miles and African Capital Alliance are joining forces with German DFI DEG to invest $80 million in Beloxxi for a significant minority stake. The capital will be used by the Nigerian biscuit manufacturer to help it ramp up production and satisfy significant levels of unmet demand in the country as well as the broader West African region.

While few additional details of the transaction were disclosed, DEG announced that it is committing $10 million to the transaction, an indication that the balance of $70 million is being provided by 8 Miles, who led the deal and Africa Capital Alliance. The consortium will have several seats on Beloxxi’s board, with Segun Adebanji, Africa Capital Alliance’s Head of FMCG, acting as the representative of the Lagos-based private equity firm.

Commenting on the transaction Adebanji said “Beloxxi demonstrates the potential of Nigerian companies to manufacture enjoyable quality products on a large-scale while also addressing Africa’s critical challenge of employing young people.  Alongside the other members of the consortium, we will leverage our expertise and relationships from over 17 years of investing in West Africa to assist Beloxxi in achieving its strategic vision.”

Beloxxi was founded as a biscuit trading company in 1994 and commenced manufacturing operations in 2006. Today it employs about 2,300 people and sells its products through a network of 400 distributors across the country.

“The snacks segment is a fast growing part of the consumer sector in Nigeria,” Nathan Mintah, Co-Founder and Co-Managing Partner of 8 Miles. “Our investment will build on the Beloxxi’s strong brand and help accelerate the Company’s expansion in Nigeria, in the wider West Africa region and beyond.”

The investment is a bet that rising populations, increasing incomes and levels of urbanization will continue to drive levels of growth within the biscuit sector which has expanded at rates of 10% to 15% in recent years. Having established a strong brand, its hoped these trends will help Beloxxi continue to deliver strong growth levels, which have exceeded 30% per annum in the last few years.

“Our long term focus is to be one of the leading biscuit companies in the EMEA region,” Obi Ezeude, Beloxxi’s CEO and Founder said. “The completion of this funding process is the first of the many steps in the achievement of our objectives…the Beloxxi story has only just begun.”

Linklaters, Aluko & Oyebode, Deloitte, SLR Consulting and Infomineo provided advisory services to the consortium on the deal.  Beloxxi was advised by FROS Capital and Detail Commercial Solicitors.

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