Dangote Cement Plc has scheduled an Extraordinary General Meeting (EGM) for January 22, 2020 to consider its proposed share buyback programme, among other issues.
According to the circular published on the Nigerian Stock Exchange (NSE), Dangote Cement plans to buy back 10 percent of its outstanding shares and thereafter cancel those shares within 10 business days of the new year 2020.
The relevant shares will be repurchased out of the profits of the company and any such number of shares bought under the programme is required to be cancelled in accordance with the Securities and Exchange Commission (SEC) rules and the NSE rule book which will consequently lead to a reduction in issued share capital,” the company said.
The buy-back programme will be completed within 12 months from the date of receipt of the approval of shareholders for the programme.
Meanwhile, Dangote Cement Plc has announced the appointment of Michel Puchercos as the new managing director of the company, effective on February 1, 2020.
“The shares will be repurchased out of the profits of the company and such number of shares bought under the programme is required to be cancelled in accordance with the Securities and Exchange Commission rules and the Nigerian Stock Exchange Rulebook 2015, which will consequently lead to a reduction in issued share capital.”
The company said the share buy-back also aimed to improve shareholder value in order to facilitate long-term growth.
It said the buy-back resolution would be passed as a special resolution to the provisions of the Sections 48 and 106 of the Companies and Allied Matters Act as well as Rule 398(3)(iv) of the SEC Rules.
Dangote Cement said an extraordinary general meeting had been convened to consider, and if thought fit, approve the alteration of the articles, programme and all matters incidental thereto.
It added that the self-tender offer price would be determined by the board, but would not be more than five per cent of above the average calculated market price over the five days preceding the offer.
It said though there would be brokerage fees and other costs, the management was of the opinion that the proposed share buy-back programme would not have any adverse effect on the company’s working capital position and gearing ratio in the long term.