Honeywell, Flour Mills Sign N80bn Merger Agreement
To further improve food production and supply in Nigeria, Honeywell Group Limited (HGL) and Flour Mills of Nigeria (FMN) have announced a merger agreement worth N80 billion.
The agreement will involve the combination of Flour Mills of Nigeria and Honeywell Flour Mills Plc, as well as a 71.69 per cent stake transfer from Honeywell Flour Mills Plc to Flour Mills of Nigeria.
Under this agreement, Flour Mills’ high-grossing agro products including grains, sugar, starches, oil and spreads will be combined with Honeywell Flour Mill’s range of carbohydrate products.
The merger agreement was designed to chart a path for the nation to attain its goal of self-sufficiency in food production, taking into cognizance, the nation’s position in the global commodities market.
A statement posted on Honeywell’s official website this week and obtained by AgroNigeria, reads, “The complementary transaction combines FMN’s market-leading offerings that include grain-based foods, sugar, starches, oils, spreads and breakfast cereals with HFMP’s market-leading diverse and differentiated range of carbohydrate products.
“The country and its food security agenda will benefit from both companies’ focus on developing Nigeria’s industrial capability, its agricultural value chain and specifically backward integration of the food industry.
“Nigeria presents vast opportunities, particularly in light of the country being the largest market on the continent as well as a signatory of AfCFTA.”
Remarking, the Managing Director of Honeywell Group Limited, Obafemi Otudeko, noted that the merger will further increase the production and investment capacity of HFM, adding that the merger agreement is in line with the company’s evolution plans.
He said, “Today’s announcement is in line with the evolution of Honeywell Group and our vision of creating value that transcends generations. For over two decades, we have supported Honeywell Flour Mills to build a strong business with a production capacity of 835,000 metric tonnes of food per annum.
“Following the transaction, Honeywell Group will be strongly positioned to consolidate and expand its investment activities, including as a partner of choice for investors in key growth sectors.”
On his part, the CEO of Flour Mills of Nigeria, Omoboyede Olusanya, said, “The proposed transaction is aligned with our vision not only to be an industry leader but a national champion for Nigeria. We believe that this will create an opportunity to combine the unique talents of two robust businesses.
“As a result, we will have a better-rounded and more comprehensive skill set available to us as a combined diversified food business, thus enabling us to better serve our consumers, customers, and other stakeholders, whilst providing employees with access to broader opportunities.”