The Nigerian Stock Exchange (NSE), has notified dealing members (stockbrokers) that the Rights Issue of Flour Mills of Nigeria Plc of 1,476,142,418 ordinary shares of 50 Kobo each at the offer price of N27.00 per share on the basis of nine (9) new ordinary shares for every sixteen (16) ordinary shares held as at 8 December 2017 will be open on Monday, 15 January 2018 and close on Wednesday, 21 February 2018.
Stanbic Ibtc Capital limited is lead issuing house for the offer, while FBNQuest Merchant bank limited and Zenith capital are Joint Issuers to the rights issue.
Proceeds from the rights issue will be used to deleverage its balance sheet, enhance working capital and position the company to explore value accretive opportunities. Deleveraging a balance sheet means to reduce the amount of debt a company holds.
The rights issue is part of a N40 billion shelf programme the board of directors had approved in October last year. Flour Mills will also be raising N70 billion medium term notes.
Flour Mills of Nigeria Plc (FMN) was incorporated on 29th September, 1960 as a private limited liability company with a paid-up share capital of N1 million and converted to a public company in November, 1978.
The group is primarily engaged in flour milling; production of pasta, noodles, edible oil and refined sugar; production of livestock feeds; farming and other agro-allied activities; distribution and sale of fertilizer; manufacturing and marketing of laminated woven polypropylene sacks and flexible packaging materials. Flour Mills is also involved in ports operation of Terminals A and B at the Apapa Port, as well as shipping logistics.
Results for the six months ended September 2017 show revenue increased from N255 billion to N298 billion. Profit before tax also increased from N8.8 billion in 2016 to N13.9 billion in 2017.
Flour Mills is currently trading at N35 in todays trading session.