A major merger and acquisition deal that may making the cement industry more exciting has been sealed as Kalambaina Cement Company Limited, a wholly owned subsidiary of BUA Cement Company Limited, has agreed to merge its business with Cement Company of Northern Nigeria (CCNN) Plc.
According to the statement sent to the Nigerian Stock Exchange, and signed by the Secretary of CCNN, Ahmed Aliyu, the board of directors of both companies are resolute in their aspiration to strengthen the competitive position of the enlarged company among cement manufacturers in Nigeria.
“It is in furtherance of this aspiration and a collective vision to create value for all stakeholders of both companies that the proposed merger is being considered”, the letter to the stock exchange stated.
“The proposed merger provides a compelling opportunity to capture significant synergies and create value for the benefit of the stakeholders of both companies in the form of stronger competitive position of the enlarged company, economies of scale, enlarged operations and administrative efficiencies which are expected to accrue from the proposed merger.”
The proposed merger is subject to regulatory and shareholders’ approval.
Aliyu said that as consideration for the proposed merger, the shares of CCNN will be issued and allotted to all shares of Kalambaina Cement in exchange for their shares in Kalambaina Cement at an agreed ratio based on CCNN’s 30 day volume weighted average closing price to June 22, 2018 of N25.99 per share.
He disclosed that it has been proposed that each shareholder in Kalambaina Cement shall be entitled to receive 19,811,372 new ordinary shares of CCNN for every 100,000 Kalambaina Cement shares.