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Obafoluke Otudeko, a Nigerian multimillionaire businessman, has increased his net worth by N2.5 billion ($6 million) in the past 17 days as shares in his integrated flour milling company, Honeywell Flour Mills, have increased by more than 13 percent.
Honeywell Flour Mills is a major player in the Nigerian agro-allied industry, with a diverse product portfolio that includes Honeywell Semolina, Honeywell Noodles, and Honeywell Pasta.
For more than two decades, the flour milling company has grown into a leading player in the Nigerian manufacturing sector, with a production capacity of 835,000 metric tonnes of food per year, under the leadership of Otudeko, who owns a 66.8-percent stake in the miller.
The recent increase in Otudeko’s stake can be attributed to a 13.9-percent increase in the company’s stock price, as investors maintained their buying interest in its shares.
As of press time on April 22, shares in the integrated flour milling company were worth N3.85 ($0.00926) per share, giving the company a market capitalization of N30.5 billion ($73.4 million).
In recent times, Honeywell’s stock price has risen from N3.38 ($0.00813) on April 5 to N3.38 ($0.00926) at the time of writing.
The increase in the company’s shares translates into a 13.9-percentage-point gain for shareholders, as investors maintain their buying interest in the company’s shares as demand for its product returns to pre-pandemic levels.
As a result, the market value of Otudeko’s stake has increased by N2.5 billion ($6 million), rising from N17.9 billion ($43 million) on April 5 to N20.4 billion ($49 million) at the time of writing.
The increase in the market value of his interest in the agro-allied company solidifies his position as one of the wealthiest investors on the local bourse.
Last year, Flour Mills of Nigeria Plc, a Nigerian agro-allied group led by Greek investor John Coumantaros, signed a definitive agreement to acquire Honeywell Flour Mills from Honeywell Group.
The combination of the two companies is expected to result in a behemoth with assets worth N702.85 billion ($1.71 billion) and revenue of around N850 billion ($2.07 billion).
According to the proposed transaction terms, the Otudeko-led Honeywell Group will sell a 71.69-percent stake in its flour-milling subsidiary, Honeywell Flour Mills, to Flour Mills of Nigeria for N80 billion ($194.7 million).
In addition, Flour Mills will also acquire an additional 5.06-percent stake in Honeywell Flour Mills belonging to First Bank of Nigeria Limited. The other stake will take the miller’s ownership interest to a 76.75-percent stake, amounting to 6,086,426,703 ordinary shares.
