Flour Mills of Nigeria Plc has announced a substantial investment plan of $1 billion aimed at expanding its operations over the next four years. Additionally, the company is exploring a secondary listing on another stock exchange to complement its current listing on the Nigerian Exchange (NGX).
During a recent interview, Chairman John Coumantaros revealed that the investment will focus on enhancing production capacity, restructuring business units, and expanding into other African markets. He indicated that most of the funding would come from internal sources, given the significant capital requirements.
As part of this investment, Flour Mills intends to allocate at least $500 million to its sugar operations in Niger State, aiming to increase annual production from 100,000 tonnes to over 400,000 tonnes. The company will also invest $100 million to establish a cassava-processing plant, which aims to reduce reliance on cassava starch imports.
Coumantaros noted that in the fiscal year 2023/2024, the company spent approximately N1.8 trillion on raw materials, resulting in a 91% decline in profits, thus underscoring the need for increased backward integration. He explained that the restructuring would involve consolidating its 22 business units into five separate companies to attract technical and financial partners for growth.
Furthermore, the chairman mentioned the possibility of a dual listing as part of the company’s strategy to become a pan-African food and agro-allied business. “Our goal is to return to the market, potentially with a dual listing,” he stated. However, he emphasized that the company must first reorganize, retool, recapitalize, and refocus before pursuing this path.
Flour Mills aims to leverage the African Continental Free Trade Area (AfCFTA) to expand its presence across the continent, starting with West Africa. Coumantaros expressed confidence in the company’s vision, stating, “Our dream is to have a pan-African food business that is headquartered in Nigeria.”
