- Bought over First Bank 5.06% stake in HFM
- Shares of First Bank rallies 6.45% after deal
- Honeywell share gains 9.73%
By Samuel Bankole
Flour Mills of Nigeria (FMN) Plc on Monday said it has entered into agreement with the majority owners of Honeywell Flour Mills tto acquired 76.75 percent stake in the rival company.
In a regulatory filing on November 22, the country’s biggest flour miller said the agreement with Honey Well Group would lead to the acquisition of 71.69 percent and the 5.06 percent of the First Bank equity in the rival flour mill firm.
“Given FMN’s parallel negotiation for both stakes culminating in the agreement signed on the same date, the basis for arriving at key commercial terms including final equity price per share, will be the same. The price payable to First Bank will be same with HGL’s
“Further detail will be communicated to the market upon obtaining relevants regulatory approval from the regulator. Shareholders and potential investors are advised to exercise caution when dealing in FMN’s shares untill a further announcment is made,” the company wrote in the regulatory communication with the Nigerian Exchange Limited.
Commenting on the transaction, Managing Director of FMN, Omoboyede Olusanya said; “The proposed transactions is part of our global growth strategy which is aligned with our vision to not only be an industry leader, but also, a national champion for Nigeria in food and agro-allied industry.”
Analysts have put the cost of the acquisition at around N80 billion giving the current share price of HoneyWell Flour Mill in the market, which further rallied by 9.73 percent to close at N3.72 per share.
Also, shares in First Bank holding company, FBNH appreciated by 6.45 percent to close at N12.30 per share as the news of acquition hit the market.
However, the shares of Flour Mills Nigeria remained unchanged at the close of transactions at N29.25 per share.