Nestle plans N15b production line expansion for Ogun plants

Nestle Foods, the world’s leading nutrition, health and wellness company, has unfolded plans for a N15 billion production line expansion for its plants in Ogun State, to be executed in two phases- N6 billion in 2016 and N9 billion in the year 2017.

The company already has some production lines and warehouses in three locations in the state, in Agbara, Sango-Ota and Sagamu-Interchange, on Lagos-Ibadan expressway, where about 2,000 residents of the state were directly employed, in addition to other factory workers sourced from other parts of the country and abroad.

Speaking during a working visit to Governor Ibikunle Amosun in Abeokuta, the state capital, Managing Director and Chief Executive Officer, Nestle Nigeria Plc, Dharnesh Gordhon, disclosed that the expansion drive became necessary in the state, having observed the government’s efforts in terms of security and enabling business environment.

Gordhon, who said the visit was to commend investor-friendly disposition of the government, which has attracted huge investment opportunities to the state, said the state’s industrial policy has inspired the company to propose an investment of N6 billion and N9 billion this year and next year respectively next year, as part of measures to boost the company’s profile.

He said 2,000 residents of the state were directly employed in Nestle’s operation and distribution lines while another 2,000 employees, including workers from other parts of the country and abroad, were also employed, adding that the expansion drive would create further employment opportunities and wealth creation in the state.

The state’s Commissioner for Commerce and Industry, Bimbo Ashiru, said “Nestle is investing over N6 billion in the state this year and between N7 billion and N9 billion next year. So, they are expanding their base, they are creating employment opportunities; they have employed about 2,000 people in this state.

“And we are looking at taking advantage of backward integration, whereby larger percentage of raw materials used will be sourced locally, our focus now is that we must be able to have industries that will be servicing other industries, so that the value chain will be completed, where we have goods being manufactured one company and raw materials being supplied by another factory.

“For example, Nestle has Olam, Olam is a major supply of what they need, Nampak Bevcan is taking another part; they do their packaging. We want our manufacturers to be nearer to their raw materials”, Ashiru added.

Amosun declared that investments worth over N70 billion had been attracted to the state in the last five years, saying that the administration would do more in terms of security, networking, favourable tax policy as well as more provision of enabling business environment for both existing and prospective investors operating in the State.

Amosun, who commended the company’s investment drive in spite of economic challenges confronting the nation, assured the company of further government’s support as it plans to expand its production lines this year and next year, saying that government would continue to collaborate with investors not only for mutual benefits, but to further increase investment in the State.

The Governor, however, enjoined industries in the State to always maintain clean and safe environment and endeavour to source their
materials from local farmers, explaining that it would go a long way in promoting grassroots farming and socio-economic development of the people, translating into more wealth and employment opportunities.