Dangote Cement Plc has announced the commencement of the second tranche of its share buyback programme.
It is a 170 million shares repurchase which will run from 19th to 20th of January as contained in a release signed by the company’s deputy secretary, Edward Imoedemhe on Wednesday.
“Tranche II will be executed under the approval granted by the Company’s shareholders at the Annual General Meeting of DCP, which was held on 26 May 2021, within the framework provided under Rule 398 (3)(xiv) of the Securities and Exchange Commission’s (“SEC”) Rules and Regulations (as applicable) and in accordance with Rule 13.18 of the Rulebook of the Nigerian Exchange Limited (“NGX”). Based on the aforementioned shareholders’ approval, the number of shares to be repurchased under the Share Buy-Back Programme will not exceed 10% of DCP’s issued capital.
“The Programme is being effected in tranches, with Tranche II being executed by the appointed stockbrokers on the Company’s behalf.”
The release further stated that the company will continue to monitor the evolving business environment and market conditions in making decisions on further tranches of the Share Buy-Back Programme, adding that an announcement will be published upon completion of Tranche II of the Programme.
The Mode of Exchange is open market on the Nigerian Exchange Limited with current shares: 17,040,507,404 as fully paid-up ordinary shares of 50 Kobo each; Tranche Size Up to 170,003,074 fully paid-up ordinary shares of 50 Kobo each, representing 1% of the currently issued shares, less treasury shares.
Shareholders and investors were advised to exercise caution when dealing in the securities of Dangote Cement until the completion of Tranche II of the Share BuyBack Programme.
Meristem Stockbrokers Limited and Vetiva Securities are joint stockbrokers for the transaction.
The market value of the company stands at N4.7 trillion as of Wednesday with Aliko Dangote as the majority owner.
The company, which disclosed the ambition two years ago, said it would purchase 170 million units of its common stock from the open market in the new phase of the share buyback scheme launched in December 2020.
The scheme is aimed at making fewer shares available for trade as it drives its share price.
Having checked its current valuation as being lower than it should be, the multinational company seeks to buy back 10 percent (1.7 billion units) of its outstanding shares hoping that the repurchase will drive up price.
It repurchased 0.24 per cent (40.2 million units) of its ordinary shares for N9.8 billion in the first tranche at the end of 2020, with the intention of acquiring 0.5 per cent.
