- The program will involve the transfer of all assets, liabilities, and undertakings of Savannah Sugar Company Limited to the Dangote Sugar Refinery.
- Savannah Sugar is currently a private entity with processing capacity to produce 50,000 tonnes of sugar per year.
Aliko Dangote, the richest man in Africa, is merging his two companies – the Dangote Sugar Company (DSC) and the Savannah Sugar Company Limited (SSCL) – into a single entity.
According to the merger plan with Savannah Sugar Company, Dangote Sugar Refinery will become the surviving entity at the end of the merger process.
Chioma Madubuko, Dangote Sugar secretary, in a corporate disclosure on Tuesday, November 5th, 2019, says the transaction will be subject to the receipt of the approval of shareholders of the two companies.
“This is to inform the investing public that the Board of Directors of Dangote Sugar Refinery Plc has recommended a business combination via a scheme of external restructuring which will culminate in the merger of DSR and its subsidiary, SSCL, a private limited liability company engaged on sugar cane farming and sugar milling.
“It is expected that the Scheme will involve the transfer of all assets, liability, and undertakings of Savannah Sugar Company Limited to Dangote Sugar Refinery and the cancellation of the entire issued share capital of SSCL with DSR emerging as the surviving entity,” the company said.
Savannah Sugar Company Limited
Located in Adamawa, Northeastern Nigeria, Savannah Sugar is a private entity currently being run by Aliko Dangote with a milling capacity of 50,000 tonnes of sugar per annum. The company said it produces refined sugar from just 6,750 hectares of sugar cane cultivated on sugarcane fields.
What does this mean for Dangote Sugar shareholders
Dangote Sugar stock is currently trading at N10.35 per share. Last week, the company posted a profit after tax of N14.7 billion in Q3, supported by the current closure of the Nigeria-Benin border.
Since the beginning of 2019, Dangote Sugar stock has lost more than 30% in share price value. With this merger scheme scaling through, the stock value of Dangote Sugar shareholders may see a jump from its present value.
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