Flour Mills of Nigeria seeks approval to buy rival

Flour Mills of Nigeria said it will seek shareholders’ approval to acquire a controlling stake in privately-held food manufacturer Rom Oil Mills, as it looks to boost its market share.
Nigeria has long been seen as one of the world’s least-tapped frontier markets, particularly for fast-moving consumer goods. Nigeria’s biggest flour and pasta maker said in a notice to investors it would seek approval at its annual general meeting on September 12 to buy a 90 per cent stake in Rom Oil Mills, based in Ibadan.
Flour Mills, whose interests include cement and fertilizer manufacturing and has a 40 per cent market share in flour milling, did not disclose how much it was offering for the stake in the vegetable and edible oil refining business. Shares in Flour Mills were trading at N52 to value it at N121 billion. In 2009, Flour Mills acquired a 51 per cent stake in privately-held rival Eagle Flourmills with a capacity of 850 tonnes per day. Industry sources say total flour demand in Nigeria is over 2 million tonnes per annum and the country has 23 flour plants.