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Thursday, January 9, 2020

Massive Growth, Major Highlights Of Opportunities For Investors As Combined Entity BUA CEMENT - Obu Cement& CCNN - Is Listed On Nigerian Stock Exchange

The combined business entity known as BUA Cement – merged between Obu Cement and Cement Company Of Northern Nigeria (CCNN)will be listed on the Nigerian Stock Exchange today, Thursday, January 9, 2020.

The move which consolidates the cement holdings of BUA group in Nigeria is part of the group’s vision of unlocking ‘’the opportunities inherent in the business space in Africa for Africans by Africans through BUA’s strategic investments in key industries within Nigeria and across the continent’’.

.The listing of the combined business entity known as BUA Cement is one of the high points of the overwhelming votes by shareholders of CCNN and Obu Cement, at their general meetings, in favor of a merger on December 4, 2019. This was followed by approvals by the courts and regulators. 

Here are a few highlights from the merger which can also be extracted from the Scheme of Merger document found here – or on the Nigerian Stock Exchange Website

-          Merger Deal Size of about NGN1,185,252,392,100 (1.18trillion Naira) or USD3.29billion* (*USD1/NGN360)

-          Current volume of shares for total combined entity (BUA cement) is 33,864,354,060 total entity shares i.e. 13,143,500,966 CCNN shares + 20,720,853,094 shares of BUA OBU Cement Shares

-          Exchange ratio is 1:1 representing the number of CCNN ordinary shares to be exchanged for OBU shares

-          Date of transaction voting was 4th of December, 2019 with 99.93% of minority shareholders voting in favor of the merger. Listing date scheduled for 9th of Jan, 2020.

-          The new entity, BUA Cement, will be the second largest producer of cement in Nigeria by Volume with factories in Sokoto State, NorthEast Nigeria (2million mtpa) and Okpella Edo State, South South Nigeria (6million mtpa). A new 3million mtpa plant currently being constructed is scheduled to be operational in 2020 in Sokoto State.

-          BUA Cement also has the benefit of market leadership positions in its key regional markets of the North West, South South and SouthEast Nigeria due to its location and proximity to those markets . It also has a huge export market in Western Africa.

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