On October 21, 2024, Flour Mills of Nigeria Plc announced a groundbreaking plan to invest up to $1 billion over the next four years to significantly expand its operations. Chairman John Coumantaros shared the details in a recent interview, emphasizing the company’s commitment to increasing investment within Nigeria.
The expansion includes a minimum allocation of $500 million towards enhancing sugar production in Niger State, aiming to boost output from the current 100,000 tons to over 400,000 tons annually. In addition, Flour Mills plans to invest $100 million in establishing a cassava-processing plant to eliminate imports of cassava starch.
In the 2023/2024 fiscal year, the company reported spending approximately N1.8 trillion on raw materials, which contributed to a 91% decline in profits. Coumantaros expressed the necessity of inviting experts to support this growth, stating, “When you grow, you can’t do everything yourself. We need technical expertise to create more jobs and business opportunities in the country.”
As part of its restructuring strategy, the company is set to consolidate its 22 business units into five distinct companies. Coumantaros noted that this move comes after Excelsior, its majority shareholder, proposed to buy out minority stakes and take the company private.
Furthermore, Flour Mills aims to leverage the African Continental Free Trade Area (AfCFTA) to expand its footprint across Africa, starting with West Africa. Coumantaros shared the vision of establishing a pan-African food business anchored in Nigeria, potentially pursuing a dual listing on both the Nigerian Exchange and other international stock markets after repositioning.
He acknowledged that the Nigerian Stock Exchange will play a vital role in Flour Mills’ future trajectory, highlighting the need for reorganization, recapitalization, and a focused strategy before any relisting efforts.
Coumantaros’ announcement is a positive signal for investors, particularly in light of recent concerns over multinational exits from Nigeria. He pointed out that President Tinubu’s reforms are beginning to yield results, as evidenced by Coca-Cola’s concurrent announcement of a $1 billion investment in expanding its operations in the country.