Africa's wealthiest man, Aliko Dangote, acquires additional shares worth $3.99 million in his Cement business
by Aderemi Ojekunle- Aliko Dangote buys back additional shares in his Cement company.
- The buy-back means additional equity in the company for Africa’s richest man with more than $10 million net worth.
- The new shares worth $3.99 million (N1.45 billion).
Africa's wealthiest man, Aliko Dangote, has acquired additional shares worth $3.99 million (N1.45 billion) in his publicly-listed company, Dangote Cement.
The deal was sealed through Dangote Industries Limited (DIL) to seal his majority shareholder status in the cash cow business.
In a transaction detail posted on the Nigerian Stock Exchange (NSE), Dangote Industries said the core investor (Aliko Dangote) has purchased additional equity in the company.
What is buyback?
According to investopedia, stock buybacks refer to the repurchasing of shares of stock by the company that issued them. Some of the reasons for repurchasing shares include ownership consolidation, undervaluation, and boosting its key financial ratios.
The deal was 8.59 million ordinary shares of 50 kobo each of Dangote Cement at N169 per share. Dangote Industries Limited concluded the transaction last week, February 7th, 2020.
Last December, the company said the share buy-back 'will improve shareholder value to facilitate long-term growth'.
Dangote Cement is Africa's leading cement producer and the main cash cow of Africa’s wealthiest man
In its Q3 2019 financial statement for the 9 months period ended September 30, 2019, Dangote Cement's group revenue recorded N679.8 billion in revenue in Q3 2019. This represented a 0.8% drop in profit.
The company is Africa's leading cement producer with nearly 46Mta capacity across ten countries in Sub-Saharan Africa.
The share is currently trading at N170, N1 jump from the buyback price, on the floor of the Nigerian Stock Exchange (NSE).