Nigerian cement and sugar tycoon, Abdulsamad Rabiu, has gained $650 million after merging Kalambaina Cement, a subsidiary company of his BUA Cement, with publicly traded Cement Company of Northern Nigeria (CCNN), where he was the controlling shareholder.
CCNN announced on Monday that it had received approval from the Securities and Exchange Commission (SEC) as well as the requisite sanction of a Federal High Court for the merger of the two companies.
The merger has given birth to the second largest cement company with Nigerian origin after Dangote Cement.
It was reported that the board of directors of CCNN in June 2018 approached the Nigerian Stock Exchange with a proposal to merge with the BUA cement-owned Kalambaina Cement Company Ltd.
CEO of CCNN, Ibrahim Aminu, had said that the proposed merger would position Sokoto-based CCNN for better competitiveness within its home market and also enable it utilise the more modern plant and equipment of the Kalambaina Cement Company to boost its market penetration and export potential.
Both Kalambaina Cement and CCNN are located in Sokoto.
With the merger now completed, new shares of CCNN have been issued and allotted to all shareholders of Kalambaina Cement in exchange for their Kalambaina Cement shares.
In total, 11,886,823,259 new shares of Kalambaina Cement have been issued at N25.99 per share, in addition to the 1.257 billion shares of CCNN, thereby bringing the current volume of shares for the total combined entity to 13.1 billion.
Through BUA Cement Company, Damnaz Cement Company Ltd, BUA International Limited and through his own name, Mr Abdulsamad owns more than 12.7 billion shares, or 97% of the new entity – a stake valued at more than $650 million at current market prices.