Flour Mills of Nigeria (FMN) Plc and Honeywell Flour Mills have agreed to combine their businesses in a merger and acquisition deal valued at N80 billion.
Honeywell Group Limited (HGL), the parent company of Honeywell Flour Mills, and FMN, through its affiliates, are undertaking the business combination.
At a total enterprise value of N80 billion dispose off a 71.69 per cent stake in Honeywell Flours to FMN.
The final equity price per share payable will be determined based on Honeywell Flour’s adjusted net debt and net working capital at the date of completion.
The proposed combination is subject to approval from the appropriate regulators.
The complementary transaction combines FMN’s market-leading offerings that include grain-based foods, sugar, starches, oils, spreads and breakfast cereals with Honeywell Flour’s diverse and differentiated range of carbohydrate products.
According to the companies, stakeholders would benefit from the more than 85-year combined track record and their shared goal of making affordable and nutritious food available to Nigeria’s population.
Commenting on the transaction, Honeywell Group Limited Managing Director, Obafemi Otudeko said: “Today’s announcement is in line with the evolution of Honeywell Group and our vision of creating value that transcends generations.
“For over two decades, we have supported Honeywell Flour Mills to build a strong business with a production capacity of 835,000 metric tonnes of food per annum.
Group Managing Director of Flour Mills of Nigeria, Omoboyede Olusanya, said: “The proposed transaction is aligned with our vision not only to be an industry leader but a national champion for Nigeria.
“We believe that this will create an opportunity to combine the unique talents of two robust businesses.
“As a result, we will have a better-rounded and more comprehensive skill set available to us as a combined diversified food business, thus enabling us to better serve our consumers, customers and other stakeholders, whilst providing employees with access to broader opportunities.”