BUA Divests From Flour Mill Business In Fresh $275million Deal

BUA Group has announced the divestment of its flour business to Olam International in a deal worth $275million.

Founder, BUA Group, Abdulsamad Rabiu, who spoke at the signing ceremony over the weekend, said: “This signing marks a major milestone in our medium term strategy. Over the years, we have run one of the largest and most efficient flour milling businesses in Nigeria and are confident in the value it will add to the buyer’s operations.”

“Our Group’s strategic focus will now be to diversify to business areas with greater potential for export where the sourcing and utilisation of foreign exchange is less and most of the materials needed for production can be sourced locally whilst also positioning our current line of Foods and Infrastructure businesses for market leadership.”

Further speaking on the Group’s medium term growth strategy, Alhaji Rabiu, who is also the executive chairman of BUA, said that expanding the backward integration of its sugar plantations in Kwara and Kogi States is key.

“Extensive work is ongoing in Lafiagi, Kwara State with over 20,000 hectares and we have another 50,000 hectares of farmland in Bassa, Kogi. These two operations form the fulcrum of our backward integration programme for sugar and this will further reduce the country’s dependence on imported raw sugar while supporting the value chain in sugar production within Nigeria

“Similarly, we expect to replicate the successes we have recorded through the deep integration of our cement operations.”

“With most raw materials for cement currently being sourced locally, we have been able to scale up operations significantly with minimal dependence on foreign exchange and will soon start exporting to neighbouring countries from both our Obu and Sokoto plants which are currently undergoing 3.5million MTPA and 1.5million MTPA capacity expansions respectively to bring the Group’s cement production capacity to around 10 million MTPA by 2018,” he added.