Shareholders of Flour Mills of Nigeria Plc have endorsed the company’s plan to raise N28.245 billion from the Nigerian capital market through rights issue.
The company is seeking to raise N28.245 billion from the market through the issuance of 455.566 million ordinary shares at N62 per share in the ratio of eight for every 33 ordinary shares, is designed to help it shore up its capital base and pursue its diversification programme.
The Group Managing Director of the company, Mr. Emmanuel Ukpabi, speaking at the completion meeting in respect of the rights issue in Lagos, Thursday, said proceeds from the rights issue would be used to pursue high growth expansionary business opportunities in the food and agro-allied sectors, reduce existing debt in its cement business and also provide working capital to support the company’s day-to-day operations.
“Proceeds of the issue will be utilised to fund the company’s financing activities, such as expansion of food business, reduction of medium term facility taken from some banks to enable it increase its holding in United Cement Company, (UNICEM), expansion of agro-allied business, investment in working capital for food and cement business and development of baking and food technology centre in Apapa,” Ukpabi said.
The shareholders who expressed their support and willingness to actively participate in the forthcoming rights issue of the company lauded the management of the company for effectively positioning the company to tap from the enormous opportunities in the Nigerian economy, especially in the agriculture and power sectors.
The President, Nigeria Shareholders Solidarity Association, (NSSA), Mr. Timothy Adesiyan, said the rate at which the company was growing over the years was a pointer to every discerning investor that the company’s shares present a good buy.
According to him, Flour Mills has been steady and has enjoyed continuous growth, especially with the introduction of innovation and cutting-edge technologies at all time.
He said the company’s diversification into the agriculture and power sectors would provide an enormous growth opportunity for the company and the country in general.
Adesiyan further noted that the eight ordinary shares for every 33 ordinary shares proposed by the company in the rights circular is another of Flour Mills’ way of putting smiles on the faces of shareholders, and that this becomes significant when viewed against recent developments in the banking sector, where shareholders were shortchanged.
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