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Lafarge Cement seeks shareholders’ nod over N140bn fresh capital

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By Nkiruka Nnorom

LAFARGE Africa Plc has disclosed plans to raise additional N140 billion from the capital market through a Rights Issue.

The company said in a notice to the Nigerian Stock Exchange, NSE, yesterday, that it will seek shareholders’ approval during the 58th Annual General Meeting, AGM, scheduled to hold on June 7, 2017, to go ahead with the capital raising exercise. The Board of Lafarge is also expected to present to its shareholders at the AGM a merger scheme between United Cement Company Limited, UNICEM, Calabar, and Lafarge Africa for ratification.

The proposals, according to the company, will strengthen its balance sheet and capital structure by reducing foreign currency exposure and optimizing the Lafarge Africa organization. “Combined with improved operating performance, the proposals will strengthen Lafarge Africa’s expansion in Nigeria. Unicem, a 100 per cent owned subsidiary of the company, has foreign exchange loan of approximately USD600 million, which was incurred for the completion of line-1 (2.5 million metric tonnes per annum (mmtpa) and the commissioning of line-2 (2.5 mmtpa).

“Between the fourth quarter 2016, (Q4’16) and April 2017, 50 per cent of the outstanding loan was hedged using the Non Deliverable Futures window of the Central Bank of Nigeria,” the company said. The company in the statement said that under the Rights Issue, LafargeHolcim Group will take up its Rights and convert its portion of the loan to equity, adding that all the shareholders of the company would have the same proportionate Rights in line with their shareholding in the company.

Combining its operations in Nigeria-Ewekoro and Sagamu plants in Ogun State, Ashakacem in Gombe State, Mfamosing in Cross Rivers State, Atlas Cement in Rivers State and Ready-Mix Nigeria with its varied operations in South Africa, Lafarge Africa has a current installed cement capacity of 14.1 mmtpa. 

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