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Flour Mills to raise additional N39.9 billion by way of rights

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Chief Finance Officer, Flour Mills of Nigeria Plc, Jacques Vauthier(left); Chief Executive Officer, Stanbic IBTC Bank Plc, DR. Demola Sogunle; Group Managing Director, Flour Mills of Nigeria Plc, Paul Gbededo; Company Secretary, Flour Mills of Nigeria Plc, Joseph Umolu at the Signing Ceremony for Flour Mills of Nigeria Rights Issue held in Lagos on Friday.

Flour Mills of Nigeria Plc has received regulatory nod to raise additional N39.9billion by way of rights to existing shareholders.

Speaking at the signing in ceremony in Lagos, over the weekend, the management of FMN Plc led by the Group Managing Director, Paul Gbededo, said the company intended to raise N39.9 billion by way of rights to existing shareholders on the basis of nine new shares for every 16 shares held.

He further explained that the issue is for shareholders, whose names appeared in the register of members of the company as at December 8, 2017, at an issue price of N27 per share.

According to him, the issue price of N27 represents a discount of 23 per cent to the company’s closing share price on the date of announcement.
The GMD explained that the SEC and NSE’s approval on the rights issue enables the company to raise funds in several tranches over a three-year period.

He added that the rights issue was being undertaken as part of the long-term plan to strategically position the firm for sustainable growth.
His words: “The rights issue is part of our strategy to grow and build long-term value for all stakeholders.

The proceeds from the rights issue will be used to strengthen the company’s capital base by deleveraging our balance sheet, supporting our working capital needs and positioning the company to exploit value-accretive opportunities, whilst giving greater operational and financial flexibility to ensure business growth and continuity.”

Speaking further, Gbededo said the full terms of the rights issue will be set out in a right circular to be mailed directly to shareholders of the company, which contains a provisional allotment letter and the participatory form.


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