In a bid to raise N90billion in fresh capital by way of rights to existing shareholders, the board of Lafarge Africa Plc. has informed Nigerian Stock Exchange (NSE), plans for an Extra-Ordinary General Meeting (EGM), on September 25, 2018, in Lagos.
The company will also seek approval “to apply any convertible loan, shareholder loan or any other loan facility due to any person, from the company, as may be agreed by the person and the company, towards payment for any shares or rights subscribed for in the rights issue.
Fortunately, the shareholders had at the 59th yearly general meeting, approved the raising of up to N100billion additional capital, subject to the approval of relevant regulatory authorities.
According to a notice signed by the Company Secretary, Mrs. Adewunmi Alode, shareholders at the EGM will also vote on special resolutions. These include the increase of the authorised share capital of Lafarge Africa from N5billion to N10billion “by the creation of 10 billion additional ordinary shares of 50kobo each, ranking pari passu in all respect with the existing ordinary shares of the company.”
Lafarge clarified that the restructuring is targeted at improving its leverage position, its industrial operations as well as strengthening its profitability.
The company also noted that reforms implemented by the firm to improve operational efficiency both in Nigeria, and South Africa, as well as effective management of its borrowing costs have impacted its performance as the Nigerian operations posted a profit of N1.9billion.
Lafarge revealed a profit of N1.9billion in its Nigeria operation for the second quarter (Q2) of 2018. Strong market growth in Nigeria within the period reflected the end of the recession in the cement market. It attributed the success in Nigerian operations to operational stability, success of the turnaround plan implementation and volume improvement.
“The company noted that turnaround plan in South Africa, which focused on cost containment, commercial transformation and industrial stabilisation, is expected to improve its operations.
Lafarge Africa’s Chief Executive Officer, Michel Puchercos, added that: “Our Company saw strong market growth in Nigeria reflecting the end of the recession in the cement market. Cement demand has been on the rise since the beginning of 2018.”