Dangote Intensifies Competition With BUA Foods, To Merge Sugar Refinery, Rice Firm With NASCON Allied

Africa’s richest man Aliko Dangote is planning a mega-merger of his sugar refinery, rice company, and NASCON Alliance, a move that may trigger fear among competitors like BUA Foods Plc.

Dangote Sugar Refinery a member of the Dangote Group said the company envisages a bigger future merging with the two other companies.

The company disclosed the plans on Tuesday in a regulatory filing seen by THE WHISTLER.

The sugar manufacturer said at the meeting held by the Board of Directors of the company on July 28, 2023, that it was resolved to “recommend the proposed merger between the Company, NASCON Allied Industries Plc and Dangote Rice Limited to the Shareholders of the Company for consideration and approval, subject to parties agreeing terms and conditions.”

It is intended that the proposed merger will be an internal restructuring executed through a Scheme of Merger, under Section 711 of the Companies & Allied Matters Act, 2020 (as amended) and other applicable rules and regulations.

Dangote Sugar and NASCON Allied, which produces salt, vegetable oil, tomato paste and seasoning are listed on the Nigerian Exchange Ltd while Dangote Rice is not listed.

Checks by THE WHISTLER showed that NASCON Alliance has a market capitalisation of N88.75bn and an outstanding share capital of N88.76bn and an outstanding share of 2,649,438,378.00. Its share price closed at N32.5 per share.

Dangote Sugar has a market capitalisation of N 364,406,347,230 and an outstanding share of 12,146,878,241 at N27 per share.

“The Company will apply for the Securities and Exchange Commission’s approval of the
Scheme, and other requisite approvals.

The Scheme is also subject to the approval of the Shareholders of the Merging Entities at the respective Court-Ordered Meetings of the
companies, as well as the sanction of the Federal High Court,” Dangote Sugar said.

On the benefits of the scheme the company said “It is expected that the transaction will consolidate and solidify the Group’s market position and ultimately reposition the Group to harness future opportunities in the foods industry.”

BUA Foods a competitor listed on the exchange has a market capitalisation of N2.44trn and an outstanding share of 18,000,000,000. Its share price is worth N135.7.