LAGOS – With the culmination of a transaction that is seen as one of the biggest strategic mergers in corporate Nigeria, Honeywell Group is set to grow its investment portfolio following the approval for the acquisition of one of its subsidiaries by Flour Mills of Nigeria (FMN).
Recall that the firm announced that Flour Mills, a major player in the Nigerian consumer goods industry, will be acquiring a 71.69 per cent stake in Honeywell Flour Mills at a total enterprise value of N80 billion.
The deal, which has recently been approved by the relevant regulatory bodies, is now poised to create the biggest consumer goods company.
Mr. Obafemi Otudeko, the Managing Director of Honeywell Group, who expressed his optimism on the impact the merger will have on both companies, the FMCG industry, and the Nigerian economy at large
He said: “We are pleased to have secured regulatory approvals for the transaction, which will create a business that further serves Nigerian consumers. As we entrust Flour Mills of Nigeria with building on Honeywell Flour Mills’ strong legacy, we will work closely with them to ensure a seamless integration, setting the combined company up for a successful future.
“We thank the Nigerian Exchange Limited (NGX), Federal Competition and Consumer Protection Commission (FCCPC) and the Security and Exchange Commission (SEC) for their support, and will continue our close collaboration with them across our various businesses and investments to deliver on the national vision of building a resilient economy through successful enterprise.”
Boye Olusanya, Group Managing Director of FMN, in the same vein, said: “We are delighted that approvals have been received and we are all set to begin execution of this landmark transaction that would positively impact Nigeria’s food security architecture and overall competitiveness.”
Both companies play a significant role in the consumer goods industry and with this merger receiving approval, the combined company will naturally be an important source of food on the continent and further bolster the Nigerian government’s food security agenda.
Following the kickoff of the African Continental Free Trade Area (AfCFTA), the newly combined company will help drive international trading activities in Nigeria, especially growing our export value in the food production space.
Similarly, a variety of food consumables presents consumers with diverse options to choose from and places the firm well as a one-stop-shop for consumer delights, with combined capabilities geared towards driving production cost down and competitive pricing.
On the future of Honeywell Group, the investment company behind the transaction has a track record in operating and investing in leading Nigerian companies giving them an expansive understanding of the market, and what it takes to build successful and sustainable businesses that create financial and social value hand-in-hand.
The company has a network of partners across key industries including technology, telecommunications, real estate, energy, infrastructure, and financial services; as well as in distinctive commercial capabilities.
Over the years, the company has been known to identify and capitalise on attractive opportunities which has seen it being early investors in various industries.
A prime example is its early investment in telecommunications in the 2000s during the advent of GSM in Nigeria.
Obafemi Otudeko, while commending the regulators for closing out the processes stated that the company was looking to the future.
He said: “Honeywell Group is poised to continue refining and growing our investment portfolio. We are strongly positioned to expand our activities in key growth sectors through strategic investments and partnerships. We remain committed to creating businesses that leave a lasting impact and look forward to sharing our future plans.”