Owing to a unanimous decision, the shareholders of Dangote Flour Mills Plc (DFM), have approved the buyout of the company by Crown Flour Mills Limited, a Nigerian subsidiary of international food and agribusiness conglomerate, Olam International Limited.
It was revealed that Olam made an N120 billion offer to the shareholders, for the acquisition of 100 percent equity in Dangote Flour Mills
Shareholders who spoke at the meeting lauded the company’s management and described the deal as a noble decision, saying it was done in the best interest of all.
Financial analyst and shareholder of DFM, Nona Awoh, commended the management on the offer of N24 per share, reminding other shareholders that the last time the share price of the company increased to N20 per share was in 2010.
Another shareholder, Mr. Boniface Solomon, said the deal was a very good one for the shareholders. He said the stock had really been struggling in view of the current realities in the nation’s economy and that the N24 per share was a good price for his members.
On his part, Managing Director (MD) of Crown Flour Mills Limited, Anurag Shukia, said his company’s intention is to maintain and expand DFM’s business while providing enhanced manufacturing capacity and improve the value chain across the country.
Following the acquisition, the entire 4,994,886,771 ordinary shares of 50 kobos each in DFM held by the scheme shareholders of the company, will be transferred to Crown Flour.
The N24 per share that will be given to the shareholders represents a 124 percent premium for 50 kobos per share on the share price of DFM as at the close of April 18, 2019, the last business day before the proposal was received and announced on the floor of the Nigerian Stock Exchange (NSE); and a 145 per cent premium on the three-month weighted average share price of the company as at April 18, 2019.
Shareholders of DFM, to enhance the value of their investment in the company, exit at attractive pricing; the deal is also expected to create a valuable relationship between Crown Flour and DFM to improve revenue generation capacity, reduce operational costs and enhance profit.