NIGERIA – Flour Mills of Nigeria PLC (FMN) has announced plan to conduct a restructuring by merging five of its subsidiaries with its holding company under a scheme of External Restructuring.
Announcing the plan, the Group Managing Director, Flour Mills, Mr. Paul Miyonmide Gbededo, was quoted in a statement to have revealed that the company had obtained the approval-in-principle of the Securities and Exchange Commission (SEC) to merge five of its wholly owned subsidiaries – Golden Noodles Nigeria Limited, Golden Transport Company Limited, FMN Cement Industries (Nigeria) Limited, New Horizon Flour Mills Limited and Quilvest Properties Limited with Flour Mills of Nigeria Plc.
According to Gbededo, the principal reason for the restructuring was as a result of the need to streamline operations, reduce administrative costs, improve operating efficiency and derive full benefits of synergy in line with the company’s long term strategic thrust.
“The enlarged FMN, upon completion of the restructuring would be able to eliminate transfer costs of materials and operate at a higher level of efficiency which will drive down costs, make product pricing more competitive, improve profitability and enhance the bottom line for the benefit of all stakeholders” Mr. Gbededo said.
Also commenting on the project, the Company Secretary, Alhaji Olalekan Saliu, stated that the management of the various companies had jointly obtained an order of the Federal High Court directing that a Court Ordered Meetings of their respective shareholders be held on Wednesday 9th September, 2015, for the purpose of approving the restructuring.
Where the shareholders give the requisite approval, the final approval of SEC would be sought and the Federal High Court will thereafter be approached to sanction the merger. The restructuring is expected to be concluded in October 2015.