NIGERIA – Flour Mills of Nigeria Plc at the weekend submitted formal application to the Nigerian Stock Exchange (NSE) seeking to raise N39.9 billion (US$111 million) in new equity funds from existing shareholders.
A regulatory filing at the NSE at the weekend indicated that Flour Mills of Nigeria plans to raise N39.85 billion through a rights issue of 1.476 billion ordinary shares of 50 kobo each at N27 per share.
The rights will be pre-allotted to shareholders on the basis of nine new ordinary shares of 50 kobo each for every 16 ordinary shares of 50 kobo each held as at Friday December 8, 2017.
Chairman, Flour Mills of Nigeria (FMN) Plc, Mr. John Coumantaros, had earlier confirmed the approval of the new fund raising by the Securities and Exchange Commission (SEC).
Shareholders had at an extraordinary general meeting in 2015 authorised the directors to raise up to N40 billion of additional equity funds through a rights issue.
Coumantaros said the board of directors will watch the capital market condition to determine the appropriate time to launch the first tranche of the new supplementary issue.
The sustained rally at the stock market might have encouraged the board of Flour Mills of Nigeria to launch the rights issue.
Reviewing the operations and outlook of the group recently, Coumantaros noted that though the operating environment has been tough and challenging, the group can look to the future with confidence that its prospects are promising and bright while the fundamentals are strong.
According to him, the group sees opportunities in the challenges and it is determined to explore them in the most profitable but sustainable manner.
“FMN is determined to continue to feed the nation every day. We shall keep maintaining our wide portfolio of high quality consumer food options and step up our input of locally sourced raw materials thereby supporting the livelihood of Nigerian farmers and Nigerian businesses,” Coumantaros said.
He added that the group would continue to invest in growing portfolio of localised products in support of the nation’s economy.
He outlined that as the group strives to further restructure its operations, streamline business operations to focus on core businesses, constantly monitor and manage costs optimally, improve and re-engineer existing product range, the group will focus on innovation and develop new strategies for the market by making its products more visible and available at points of sale.
“We shall also continue to improve our sales, merchandising, redistribution personnel and activities,” Coumantaros said.
He reiterated the support of the group for the Federal Government’s backward integration policy, assuring that the group is determined to ensure that its agro-allied strategy provides sustainable returns on capital invested by maximising local content in group products.
He noted that in furtherance of the group’s vision to be involved at all stages of food value chain- from the farm to table, raw materials are being produced locally to ensure that good quality but fair value products are developed locally through the food supply chain to final consumer consumption.
“By our policy of aggregating grains and local farm products, we are creating jobs and boosting rural economy.
We are determined to continue to ensure that our investments and processes aside from ensuring value for shareholders and other stakeholders continue to enrich the lives of our consumers, farmers, suppliers and other relevant stakeholders,” Coumantaros said.