THE proposed offer to buy out the minority shareholders of Flour Mills of Nigeria Plc – a move that could result in the company’s delisting from the Nigerian Exchange – has been described as unfortunate and painful by shareholders.

The Securities and Exchange Commission (SEC), has approved the arrangement for Flour Mills’ majority shareholder, Excelsior Shipping Company Limited, to acquire all the shares held by minority shareholders of the company.

In two separate statements to the investing public on Tuesday, September 24, Flour Mills said Excelsior Shipping Company had offered N70 per share to acquire all shares held by minority shareholders.

“The legal and beneficial ownership of the scheme shares (as defined in the scheme document) shall be transferred to Excelsior Shipping Company Limited and its wholly owned Nigerian subsidiary, Greywise Investment Solutions Limited, without further act or deed.

“In exchange, shareholders will receive N70 per share as consideration for the transfer,”  it stated.

According to Flour Mills, the proposed acquisition had received a “no objection” ruling from the SEC.

“The acquisition marks a significant shift for Flour Mills of Nigeria, signalling its departure from the exchange and the consolidation of control by its majority shareholder, Excelsior Shipping Company Limited,” it added.

Commenting on behalf of members of the New Dimension Shareholders, the national president, Patrick Ajudua, said it was unfortunate.

“We as shareholders acknowledge the effect of the devaluation of naira, high cost of doing business and inflationary pressures on their business which has caused them to incur huge foreign exchange losses resulting in negative bottom line and inability to pay dividend,” he said.

He noted the scenario has the effect of threatening the going concern of companies battling with liquidation, blaming the apex regulator, SEC, for not being alive to its responsibilities.

“But of much concern is the role of our regulator in ensuring that they address some of these challenges and a call on the government to ensure the survival of these companies who hitherto have been paying taxes, creating more employment opportunities, and contributing to the economic development of our country.

“Hence, the failure of government and regulator to be alive to its responsibility has led this company to take this bitter decision to delist or exit the country,” Ajudua said.

He also expressed concern about the N70 per share buyout offer, stressing that it was not satisfactory to minority shareholders.

“Therefore, the company must review it upward as the protection of minority shareholders interest must be guaranteed.

“For us as shareholders, we will employ the company to reconsider their decision to delist and hopefully pray that the government that regulator will act fast to save this industry,” Ajudua added.

Meanwhile, Flour Mills said it had secured approval for a Court-Ordered Meeting for November 14, 2024, where shareholders will review and vote on the proposed scheme of arrangement.

September last year, the shares minority shareholders of PZ Cussons Nigeria Plc were acquired following the planned exit of the company from the Nigerian market, The ICIR reported.

Many companies are faced with delisting from the Nigerian stock market especially the manufacturing companies that are mostly faced with dollar-denominated obligations arising from Central Bank of Nigeria’s exchange rate unification.