News in brief:
– Flour Mills of Nigeria (FMN) is restructuring to expand across Africa and improve operational efficiency.
– The restructuring will strengthen local partnerships, boost food security, and enhance Nigeria’s economic growth.
Flour Mills of Nigeria PLC (FMN), a key player in Nigeria’s food and agro-allied sectors, is embarking on a significant restructuring effort to expand its presence across Africa. This move signals FMN’s commitment to becoming a pan-African leader while maintaining its Nigerian roots.
Why the restructuring?
FMN has operated for 64 years, growing from a single flour milling company into a conglomerate in food production, agriculture, and logistics. However, the company’s current structure is seen as limiting its potential to capitalise on Africa’s growing markets. It plans to streamline its operations and focus on its core strengths, allowing for more flexibility to seize regional growth opportunities.
Central to the restructuring is a share acquisition plan where FMN intends to buy out minority shares. This is a strategic move to gain full control of its operations, enhance competitiveness, and expand across West Africa. Minority shareholders are being offered a premium on their shares, signaling the company’s commitment to transparent corporate governance.
Nigeria’s economic reforms and FMN’s role
Nigeria, the continent’s largest economy, is undergoing significant reforms to diversify away from oil dependency. FMN sees these reforms as an opportunity to play a more prominent role in ensuring food security and economic growth. The company aims to strengthen local supply chains, partner with Nigerian farmers, and boost agricultural productivity. This is expected to enhance its ability to scale its operations across Africa, starting with West Africa.
Despite concerns about ownership control, FMN emphasises that the restructuring is anchored in its long-term growth strategy. The company’s chairman, Mr. John G. Coumantaros, reassured stakeholders that the initiative is driven by Nigerian leadership, aimed at reinforcing the company’s contributions to Nigeria’s economy while positioning it as a leader in Africa’s food security sector.
