Dangote Cement Plc, the leading cement manufacturer majority owned by Africa’s richest man Aliko Dangote, has completed the second tranche of its share buyback program, acquiring a 0.74-percent stake for N35.1 billion ($84.5 million).
The move comes nearly two weeks after the Nigeria-based cement producer announced the start of the second tranche of its share buyback program in a disclosure issued from its Victoria Island Office in Lagos, Nigeria.
According to a statement issued on the Nigerian Exchange on Wed., Jan. 26, the cement behemoth repurchased a total of 126,748,153 shares, or 0.74 percent of its issued and fully paid ordinary shares, at an average price of N276.89 ($0.667) per share.
Meristem Stockbrokers Limited and Vetiva Securities Limited, the company’s appointed stockbrokers, carried out the transaction.
The stockbrokers participated in the program by purchasing Dangote shares on the open market between Jan. 19 and 20, subject to market conditions and the Nigerian Exchange’s daily trading rules.
Shares in the cement maker rose from N259 ($0.624) per share on Jan. 11 to N284.9 ($0.686) per share at the time of writing this report thanks to stockbroker buying activities and investor reactions.
The bullish sentiment resulted in a 10-percentage-point gain for shareholders, while Dangote, who owns an 87-percent stake in the industrial behemoth, saw his net worth rise above $20.4 billion as a result of the value increase in his stake.
Experts believe the share buyback program is a deliberate attempt by the board to boost the intrinsic value of the world’s largest cement company, which aligns with the next phase of its expansion plans.
Dangote Cement is Africa’s largest cement maker, with a production capacity of 48.6 million tonnes per year across 10 countries. In the first nine months of 2021, the behemoth generated a profit of N278.3 billion ($677.6 million) and a revenue of N1.022 trillion ($2.49 billion).
In the first tranche of its share buyback program, the cement behemoth bought back shares worth N9.77 billion ($23.56 million).
Since the commencement of the share buyback program on Dec. 21, 2020, the company’s shares have soared from a price of N230.4 to N284.9 ($0.668) per share as of the time of the writing of this report, while its market capitalization is valued at N4.85 trillion ($11.69 billion), thus making Dangote Cement the most valuable company on the Nigerian Exchange.
