Story by Olabode Jegede
After months of what may have been behind the scene haggling, Dangote Flour Mills (DFM) Plc, on Tuesday, said that Olam International, a Singaporean commodities trading company has agreed to acquire 99per cent of its entire five billion shares in issue at N24 per share, translating to slightly lower than the initial N120billion.
It also represents “the enterprise value on a debt-free, cash-free basis, payable in cash at the closing of the proposed transaction,” according to an earlier filing in April 2019.
Both companies had initially agreed on a binding offer of N26 per share, or N130billion “consideration” to be “adjusted for net working capital and net debt as of 31 March 2019 or any other later date that may be agreed by Olam and the board of DFM to arrive at the final price payable to equity shareholders.”
DFM had earlier said also that the offer will be reviewed by its board, urging shareholders to exercise caution when dealing in its shares, while awaiting further announcements.
In effect, Olam International will now pay N119.87billion for the remaining 99.9per cent shareholding.
The N24 per share represents 14.28per cent premium on the N21 each it closed on Monday.
However, since the announcement of the proposed acquisition, the share price of DFM has soared by over 200per cent.
In a filing with the Nigerian Stock Exchange (NSE) on Tuesday, directors of DFM announced Monday, October 14, 2019, for the court-ordered meeting at which shareholders will consider and possibly approve the scheme of arrangement preparatory to the acquisition of its entire shares by Olam International.
The directors will propose at the October 14 meeting that, subject to the sanction of the court, the beneficial ownership of 100% of the shareholding of the company (not currently held by Crown Flour Mills Limited or any of its subsidiaries or affiliates), be transferred to Crown Flour Mills Limited and any other nominees of Crown Flour Mills Limited.”
For the purpose of the said meeting, the register of members of DFM will be closed between September 30, and October 4, 2019; following which only shareholders whose names appear in the register on Friday, September 27, will be entitled to attend and vote at the meeting.