- Shareholders Approve N90b Rights Issue for Lafarge Africa
Shareholders of Lafarge Africa Plc have approved plan by the company to raise about N90 billion in new equity funds as the cement company seeks to deleverage its balance sheet and restructure short-term loans.
At an extraordinary general meeting in Lagos, shareholders approved resolutions authorising the company to create additional 10 billion ordinary shares of 50 kobo each to increase its authorised share capital to 20 billion ordinary shares.
Shareholders also authorised the board of the company to raise capital of N90 billion by way of a rights issue of ordinary shares to its shareholders and that the rights issue be executed at such price, time, for such period and on such other terms and conditions as the directors may deem fit.
Also, the meeting granted the board the authority 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.
Shareholders also authorised the company to enter into a related party transaction to accept loan facility from LafargeHolcim, the foreign majority core investor which holds 76.32 per cent equity stake.
Chairman, Lafarge Africa Plc, Mr Mobolaji Balogun, said the additional capital to be raised will further help to deleverage the company’s balance sheet and provide head room for the expansion of its business.
He said the company foresees a stable pricing environment and favourable economic conditions in its Nigeria market while its South Africa operations are undergoing a turnaround plan.
Chief Executive Officer, Lafarge Africa Plc, Mr. Michel Puchercos said the company’s refinancing plan is aimed at preparing for future development in Nigeria by improving the company’s leverage as well as strengthening its profitability.