A majority shareholder in Nigeria’s largest juice and dairy company, Chi Limited, Tropical General Investment (TGI) Group, on Saturday sold 40 percent of its stake to the world’s largest beverage company, Coca-cola.  This deal signals Coca Cola’s plan to expand across Africa by 2020 and redouble its effort to expand beyond soda as its soda sales is low.

In a press statement, Coca-Cola said it intends to acquire the remaining 60 percent stake in the next three years pending regulatory approval.

This deal does not come as a surprise to industry watchers as it was reported in 2014 that TGI group was exploring options to sell its stake in Chi Limited for as much as $1 billion. It was also suggested that multinational drink makers such as Coca-Cola, Pepsi would find this deal attractive.

 A closer look at CHI Limited and Coca-Cola:

Although the financial terms of the deal is yet to be disclosed, it is estimated to be about $400m.

This investment in Nigeria is coke’s biggest overseas acquisition since 2012.

TGI owns several other companies ranging from poultry and fish farming to frozen foods and cotton. Its businesses span across numerous countries, including South Africa, Morocco and China.

Coke had a 45% share of the $18.12 billion soda market in the Middle East and Africa last year, but only 3.5% of the region’s fragmented $8.03 billion juice market. According to Euro monitor TGI was the No. 2 juice player behind Iran-based Alifard Co., with a 4.2% market share and $337 million in retail sales.

In 2014, the Coca-Cola system announced an increased investment in Africa to a total of $17 billion from 2010 to 2020. This investment, which is roughly three times the amount invested in the last decade, is funding new manufacturing lines, distribution capabilities and cold drink equipment while creating additional jobs and opportunities on the continent.

Chi Limited is one of the leading Food & Beverage company in Nigeria and has market leadership positions in fruit juices, ice tea, value-added dairy products and snacks in Nigeria. Chi brands include CHIVITA 100%, CHIVITA Active, CHI Exotic, CHI Happy Hour, CHI Ice Tea, Capri-Sonne, Hollandia, Chi Super Bite and Beefie.

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