NGX suspends trading of Flour Mills of Nigeria shares ahead of delisting

NIGERIA – The Nigerian Exchange Limited (NGX) has officially suspended trading in Flour Mills of Nigeria Plc (FMN) shares as part of the company’s preparation for delisting.

The suspension, which took effect on 16 December 2024, is a strategic move by the NGX to facilitate the orderly process of the company’s exit from the stock market.

According to Cowry Asset Limited, a stockbroker involved in the transaction, the suspension is in line with the NGX’s approval and aims to prevent further trading activities as the delisting preparations move forward.

Stockbrokers have emphasized that the decision is designed to ensure an efficient transition and avoid disruptions in the process.

Flour Mills of Nigeria Plc, a prominent player in the Nigerian food and agriculture sector, has informed the NGX that it has received an offer from its majority shareholder, Excelsior Shipping Company Limited, to acquire all shares held by the company’s minority shareholders.

This transaction will be executed through a scheme of arrangement, as outlined in Section 715 of the Companies and Allied Matters Act 2020 (as amended). The deal is set to see Excelsior Shipping Company acquire the outstanding shares in FMN, which are not already under its control.

As of September 24, 2024, Excelsior Shipping Company holds a substantial 63% stake in FMN, comprising 2.59 billion shares valued at approximately N142.8 billion (US$92M).

The buyout of the remaining minority shares will cost the company an estimated N105.2 billion (US$67.7M), providing an exit package for shareholders.

This acquisition and the subsequent delisting of FMN from the stock market have already received the necessary approval from the Securities and Exchange Commission (SEC), marking the end of an era for the company’s presence on the Nigerian Exchange.

Recently, the milling giant announced a restructuring plan to transition the company’s structure.This initiative aims to align FMN’s strategy with its long-term vision of becoming a Pan-African food leader.

At the heart of this transformation is a share acquisition plan, aimed at purchasing minority shares to streamline operations and enhance competitiveness across the continent.

The company’s delisting marks the end of an era for the food conglomerate’s presence on the stock exchange, but it also underscores the growing trend of private acquisitions in the Nigerian market.

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