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    Flour Mills Acquire 71.69% Stake in Honeywell Flour Mills

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    Naija247news Editorial Teamhttps://www.naija247news.com/
    Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

    Flour Mills of Nigeria (FMN) Plc and Honeywell Flour Mills on Monday announced a merger and acquisition deal valued at N80 billion.

    Honeywrll Group Limited, the parent company of Honeywell Four Mills, and FMN are undertaking the business merger.

    At s value of N80 billion HGL agreed to dispose 71.69 per cent stake of its shares to FMN.

    Exchange sources said final equity share pricr payable will be determined based on Honey Flour adjusted net debt and net working capital at the date of completion of the acquisition.

    The complementary transaction pushes FMN as the market leader with offerings that includes grain-based foods, sugar, starches, oils, spreads and breakfast cereals with Honeywell Flour’s diverse range of products.

    The companies said stakeholders would benefit from more than 85 year combined track record of both companies and their shared corporate goals of making nutritious food available to Nigeria’s population.

    Addressi g the development, HGL Managing Director Obafemi Otudeko said: ” Today’s announcement is in line with the evolution of Honeywm Group and our vision of creating value that transcends generations.

    ” For over two years, we have supported Honeywell Flour Mills to build a virile business with our production capacity of 835,000 metric tonnes of food pet year.

    ” Following the transaction Honeywe Group will be strongly positioned to consolidate and expand it’s investment activities.

    FMN Plc’s Group Managing Director Omoboyede Olusanya said the proposed transaction is in line with the company’s vision to be an industry leader and Nigeria’s number one food brand.

    “We are of no doubt that this would create the right opportunity to combine the unique talents of the two businesses for the benefit of their consumers.

    “ The key highlights of the proposed transaction are as follows:
    HGL will dispose of a 71.69% stake in HFMP to FMN based on an enterprise value of NGN80 billion. The final equity price per share payable will be determined based on HFMP’s adjusted net debt and net working capital at the date of completion.
    The proposed combination is subject to approval from the appropriate regulators.
    The complementary transaction combines FMN’s market-leading offerings that include grainbased foods, sugar, starches, oils, spreads and breakfast cereals with HFMP’s market leading diverse and differentiated range of carbohydrate products.
    Stakeholders would benefit from the more than 85-year combined track record of FMN and HFMP and their shared goal of making affordable and nutritious food available to Nigeria’s population.
    The scale of the transaction provides employees of the consolidated company with more career development opportunities in a larger organisation, with the potential to create more jobs in the economy as it will have more brands and categories, and a larger and more geographically diverse footprint.
    Customers across the nation will benefit from access to a wider product range and a robust pan-Nigerian distribution network, accessing greater number of points of sale supported by enhanced customer-focused sales teams and redistribution capabilities.
    The combination will also serve as a catalyst for an even stronger stream of innovation that is focused on local content offerings.
    The country and its food security agenda will benefit from both companies’ focus on developing Nigeria’s industrial capability, its agricultural value chain and specifically backward integration of the food industry.
    Nigeria presents vast opportunities, particularly in light of the country being the largest market on the continent as well as a signatory of AfCFTA.
    HFMP’s listing will be retained for the foreseeable future. Minority shareholders of HFMP will be treated fairly and in line with capital market regulation. Further information will be provided within the required channels and timeframes.

    Commenting on the transaction, Honeywell Group Limited Managing Director, Obafemi Otudeko said: “Today’s announcement is in line with the evolution of Honeywell Group and our vision of creating value that transcends generations. For over two decades, we have supported Honeywell Flour Mills to build a strong business with a production capacity of 835,000 metric tonnes of food per annum. Following the transaction, Honeywell Group will be strongly positioned to consolidate and expand its investment activities, including as a partner of choice for investors in key growth sectors.”

    Omoboyede Olusanya, Group Managing Director of Flour Mills of Nigeria, said: “The proposed transaction is aligned with our vision not only to be an industry leader but a national champion for Nigeria. We believe that this will create an opportunity to combine the unique talents of two robust businesses. As a result, we will have a better-rounded and more comprehensive skill set available to us as a combined diversified food business, thus enabling us to better serve our consumers, customers and other stakeholders, whilst providing employees with access to broader opportunities.”

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