Flour Mills Proposes Merger With Bagco, Bagco – North

Flour Mills of Nigeria Plc has notified the Nigerian Stock Exchange (NSE) of its plans to merge  with Nigerian Bag Manufacturing Company Plc (“Bagco”) and Northern Bag Manufacturing Company Limited (Bagco – North.)

According to the notice, the three companies are expected to merge into one entity with Flour Mills Nigeria Plc as the surviving entity.

Flour Mills and Bagco are public companies listed on the floor of NSE, while Bagco – North is a private limited liability company.

The merger would, therefore, result in the transfer of all assets, liabilities and undertakings of Bagco and Bagco – North to Flour Mills Nig. Plc.

Consequently, the entire issued share capital of Bagco and Bagco-North respectively would be cancelled and the minority shareholders of Bagco will have an option to elect for cash or shares in Flour Mills at a price to determined using mutually agreed valuation methods.

The notice also explained that Bagco and Bagco-North would be dissolved without winding up. Justifying the transaction, the companies said there was need to streamline operations, reduce administrative costs, improve operating efficiency and capture the full synergies arising from the merger.

Flour Mills had recently notified the NSE that it has acquired “controlling interest” in Thai Farm International Limited.

The company said the acquisition was a well focused drive to expand its business interest in the Nigerian agricultural sector”.

It explained that the resolve was also designed to further confirm Flour Mills’ unalloyed support for the federal government’s Agricultural Transformation Agenda, and it has already commenced major agro-allied investments in rice cultivation and milling.

Other areas of investment in agriculture according to the company, are sugar growing, milling and refining, maize and soya beans growing, palm oil cultivation and refining and production of animal feeds.

Thai Farm, which began operations in 2010 grows and processes cassava in Ososa, Ogun State.

In a statement, the company said, “Thai Farm has grown to be one of the two leading corporate suppliers of High Quality Cassava Flour (HQCF) to Flour millers in Apapa and elsewhere for the past two years.