BUA Cement on Thursday, January 9, 2020, listed on the Nigerian Stock Exchange (NSE) with a market capitalization of over 1 trillion Naira in what is the third major listing on the bourse within a year after telecoms behemoths MTN and Airtel went public in May and July 2019, respectively.
The development also signifies the conclusion of a merger between the BUA’s cement entities, Cement Company of Northern Nigeria (CCNN) and Obu Cement, which were majorly owned by Alhaji Abdulsamad Rabiu and Alhaji Isiaka Rabiu. Obu Cement now becomes BUA Cement Plc with the trading Symbol is “BUACEMENT.”
“Consequently, the entire 13,143,500,966 ordinary shares of CCNN was delisted… while the entire 33,864,354,060 ordinary shares of 50 kobo each of BUA Cement Plc (Formerly OBU Cement) were listed today, Thursday, 9 January 2020,” said Godstime Iwenekhai, Head of Listings Regulation Department at the Exchange, in a notice of scheme of merger between CCNN and OBU Cement Company Plc.
Prior to the merger, shareholders of both companies had approved the process which will see CCNN shareholders receive 1 share in Obu Cement (now BUA Cement Plc) for every 1 share held in CCNN. They decided to merge in a bid to leverage on synergies and create greater values for shareholders and other stakeholders of the entities, according to Yusuf Binji, Managing Director of BUA Cement Plc.
The concluded merger means the enlarged BUA Cement Plc has a total installed capacity of eight million metric tonnes per annum, with an additional 3 million metric tonnes plant expected to come on stream in the second half of 2020.
“The essence of the merger is to be able to tap into the potentials and unlock the opportunities that are within the two companies in terms of market size, dealership base, profitability, and staff skills,” Binji said. “There will be a lot of positives as we go along the way.”
The listing sees the cement maker become the third-largest listed company in Nigeria, second-largest cement company in the country and West Africa, as well as one of the five companies with over N1 trillion market capitalization on the Nigerian bourse. The company’s share price closed at N38.45 on Thursday after opening at N34.65.
For the Exchange, meanwhile, it is “exciting” to record such major listing at the beginning of the year, NSE CEO, Oscar Onyema, said, adding that it was another opportunity for investors to have access to a company with a good track record.
The Exchange now has an additional N1.18 trillion in market capitalization after the BUA Cement listing, according to Premium Times, citing the News Agency of Nigeria (NAN). The company also plans to move to the Premium Board of the NSE in a very short period of time, Onyema revealed.
BUA Cement Plc is a member of the BUA Group, founded in 1988 as a Private Limited Liability Company with a specialization in the importation and marketing of iron and steel, agricultural and industrial chemicals. Since then it has rapidly developed into a diversified conglomerate with a portfolio comprising a wide range of businesses including sugar refinery, real estate, oil mills as well as ports and terminal.