Nigeria’s largest beer brewer, Nigerian Breweries Limited (NBL) and Consolidated Breweries Limited, will officially become a single entity, following an agreement to proceed with a merger signed last week, Heineken, a majority shareholder in both companies, has announced.

“A Pre-merger Notification has been served with the Nigeria security and exchange commission on behalf of the two companies,” read an official statement from Heineken.

An approval for the completion of the deal is yet to be secured, meaning both firms will remain independent entities for the time being, the statement added.

The merger is expected to boost benefits from increased economies of scale, enhance operating and administrative efficiencies, and increase the new company’s ability to respond to market trends.

Though Heineken – the world third Largest Brewer – controls a significant share of the beverage drink market in Nigeria, with its subsidiary NBL holding an estimated 60 percent of the alcoholic drink market share, the decision to merge both NBL and Consolidated Breweries confirms a growing threat from emerging competitors including Diageo, parent company of Guinness Nigeria, and SABMiller, makers of Heroes Lager Beer.

The Dutch-based beer producer holds arguably the largest and most diversified portfolio of alcoholic and non-alcoholic drinks in Nigeria. Its subsidiary, NBL – which it holds a 54.1 percent – rolls out top selling brands including Star Lager Beer, Gulder Lager Beer, Maltina, Legend extra Stout, Amstel malta, Heineken Lager Beer,  Fayrouz as well as climax energy drink, Goldberg Lager Beer, and Malta Gold.

Consolidated Breweries, however is Nigeria’s third largest brewery and producer of “33” Export Lager Beer, Turbo King Dark Ale, Hi-Malt and Maltex Malt Drink. Together, the newly formed company will consolidate its position as the country’s leading provider of Beverages.

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