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Dangote Cement to buy back 85m units of own shares

Dangote Cement to buy back 85m units of own shares

Dangote Cement Plc Monday said it would next week commence the first phase of the plan to buy a portion of its ordinary shares back from shareholders.

The scheme has been in the works for months since the company’s shareholders granted its management the go-ahead to repurchase 10% of its common stocks in January, a move analysts believe will reduce the quantity of the shares of Dangote Cement available in the market and, in so doing, boost its valuation.

“The Share Buy-Back Programme will be executed … within the framework provided under Rule 398 (3)(xiv) of the Securities and Exchange Commission’s (“SEC”) Rules and Regulations (as applicable) and in accordance with Rule 13.18 of the Rulebook of the Nigerian Stock Exchange (“The NSE”),” Dangote Cement said in its notification to the Nigerian Stock Exchange (NSE).

It added that “the number of shares to be repurchased under the Share Buy-Back Programme will not exceed 10% of DCP’s issued capital.”

Read also: Nigerian govt frees Dangote Cement to operate across borders

The first phase will kick off on Wednesday 30th December and will see Dangote Cement mop up 85,202,537 ordinary shares or 0.5% of its around 17.041 billion ordinary shares from circulation.

It will be completed on 31st December or “when the entire Tranche Size has been purchased.” The transaction will be executed by the company’s stockbrokers, Meristem Stockbrokers Limited and Vetiva Securities Limited.

“The shares being bought back by the Company under the Share Buy-Back Programme will be held as treasury shares, and may subsequently be cancelled,” Dangote Cement said.

Following the announcement, shares in Dangote Cement surged by 9.98% or N20.9 to N230.4 per unit at the Monday trading session. The price of the stock is expected to keep rising from now till the end of the first tranche of the buyback programme.

The buyback could help the cement manufacturer regain its status as the most capitalised company in Nigeria after losing that position to MTN Nigeria some months back.

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