West Africa’s second-largest Cement company, BUA Cement, today listed on the Nigerian Stock Exchange with a market capitalization of 1.2trillion Naira (USD3.3billion) bringing to a conclusion, the merger between the BUA-owned cement entities, Cement Company of Northern Nigeria and Obu Cement company.
This listing brings BUA Cement’s total capacity across all its cement assets to 8million MTPA with an additional 3million metric tonnes plant coming on stream in H2, 2020.
Speaking at the closing gong ceremony to commemorate the listing, Engr. Yusuf Binji, Managing Director of the new entity said, “BUA Cement is poised to add even more value to the Nigerian economy as a whole through this listing.
“Over the past few years, we have significantly ramped up capacity and currently boast the most efficient and integrated operations in the Nigerian Cement Industry. This new publicly listed company will continue to deliver exceptional value to all stakeholders in the foreseeable future.”
According to the statement, BUA Cement further alluded that the proposed merger provides a compelling opportunity to capture significant synergies and create value for the benefit of the shareholders of both companies in the form of the stronger competitive position of the enlarged company, economies of scale, enhanced operations and administrative efficiencies that will accrue.
The CEO of the Nigerian Stock Exchange, Oscar Onyema, applauded the Founder of BUA Group and Chairman of BUA Cement, Abdul Samad Rabiu, for bringing BUA’s expanded Cement Business to the Nigerian Stock Exchange describing it as a “show of confidence in the value the NSE offers”.
With this listing, BUA Cement becomes the third most capitalized stock on the Nigerian Stock Exchange and joins an exclusive trillion Naira club on the NSE.
Key facts about the merger
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.
The 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 favour of the merger. Listing date was 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, North West 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.