Modupe Gbadeyanka
By Modupe Gbadeyanka
On Tuesday, April 23, 2019, the board of Dangote Flour Mills Plc informed the investing public through the Nigerian Stock Exchange (NSE) that it had received an offer from Olam International Limited (Olam), the parent company of one of its shareholders, Crown Flour Mills Limited (Crown Flour), for the purchase of 5 billion issued shares of the company at N130 billion, amounting to N26 per unit.
It was then emphasised that the offering was to be adjusted among other things for net working capital and net debt of the firm as at March 31, 2019 or any other later date that may be agreed by Olam and the board of Dangote Flour; and to exclude shares held by Olam through its subsidiary, Crown Flour to arrive at the final price payable to shareholders of Dangote Flour.
When the April 2019 announcement was made, it sent the share price of the company northwards as it was enjoying bull run until it began to retreat later.
On Monday, August 5, 2019, the board, in a notice to the NSE, said it has received a revised offer from Crown Flour with a final consideration of N120 billion for the acquisition of the company’s 5 billion shares at the rate of N24 each. It explained that the lowering of the valuation followed some adjustments.
It was stated that shareholders of Dangote Flour, excluding Crown Flour, would be paid this amount in accordance with the terms of the scheme document to be considered and approved by the shareholders at a court ordered meeting to be convened for that purpose.
Dangote Flour board noted in the statement that it received from Crown Flour and Olam an addendum dated August 1, 2019 to the initial binding offer of April 23, 2019 to acquire all the outstanding and issued shares of the firm not currently owned by Olam through Crown Flour.
During the first notice, Olam had indicated that the transaction would be effected through Crown Flour, affirming its unequivocal and irrevocable financial support to complete the deal.
In today’s disclosure, Dangote Flour stressed that, “Save as stated in this announcement, the terms and conditions of the initial offer as earlier notified are still applicable.”
