Heineken Says Nigeria Potential Outweighs Risk of Civil Unrest

Heineken NV (HEIA), the world’s third-biggest brewer, said the potential of the Nigerian market outweighs the security risk caused by deadly bombings in Africa’s biggest economy.

“We know what it means to have a crisis and insecurity,” Siep Hiemstra, president of the Amsterdam-based company’s Middle East and Africa unit, said in an interview with Bloomberg TV Africa, citing the company’s experience during civil conflicts in Rwanda and South Africa. “We also believe that if you are totally focusing on only the challenges and the things that are not going well, you totally lose focus on the promises, and the promises are huge.”

Heineken competes with London-based Diageo Plc (DGE) and SABMiller Plc (SAB) in Nigeria, where attacks by the Islamist group Boko Haram have left more than 4,000 people dead in five years. Hiemstra said no beer company could consider itself truly international without being in Africa, as brewers are looking to tap booming economic growth in emerging markets. Nigeria is the continent’s most populous country with about 170 million people.

Heineken is awaiting regulatory approval to merge its two Nigeria units, which would combine the country’s industry leader with the No. 3 beermaker. Nigerian Breweries Plc (NB) and Consolidated Breweries Plc would merge to “create a business that is more streamlined and more adapted to the Nigerian market,” Hiemstra said in the interview, which will be broadcast tonight.

The Dutch company holds 54.1 percent of Nigerian Breweries, which owns brands including Heineken and Star, and 53.8 percent of Consolidated, the maker of Turbo King.

To contact the reporter on this story: Yinka Ibukun in Lagos at yibukun@bloomberg.net

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net John Bowker, David Risser

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