Flour Mills of Nigeria Plc, the country’s largest milling company, has announced plans to invest up to $1 billion over the next four years to expand its operations. This significant investment is aimed at boosting production capacity and exploring new markets across Africa, leveraging the African Continental Free Trade Area (AfCFTA).
Chairman John Coumantaros disclosed the expansion plans during an interview, revealing that $500 million will be directed towards increasing sugar production in Niger State. The goal is to raise output from 100,000 tons to over 400,000 tons annually. Additionally, $100 million will be invested in a cassava-processing plant to eliminate cassava starch imports. These investments come after the company’s 2023/2024 financial year, in which it spent N1.8 trillion on raw materials, leading to a 91% decline in profits.
Coumantaros emphasized that while Flour Mills will internally fund most of these projects, the company will seek external expertise to drive growth. “The requirement for capital is going to be very, very large. And of course, we will be backing the majority of that,” he said. However, he noted the need for partnerships, adding, “You need to invite those experts of the best in field to really support you and assist you so we can grow more business, more jobs here in the country.”
Restructuring for Growth:
The company is also restructuring its business operations. Following an offer from its local partner, Excelsior, to buy out its minority stake and go private, Flour Mills will reorganize its 22 business units into five separate companies. This restructuring aims to attract both technical and financial partners, particularly to support its sugar and food business growth.
Coumantaros highlighted that Flour Mills’ expansion is not limited to Nigeria. With the inception of the AfCFTA, the company is eyeing opportunities across Africa, starting with West Africa. “We believe strongly that we shouldn’t be just looking at the Nigerian market. Our dream is to have a pan-African food business that is headquartered in Nigeria,” he explained. The company plans to take advantage of the AfCFTA to expand its footprint in the region.
Flour Mills also intends to explore a dual listing on the Nigerian Stock Exchange (NGX) and other markets after it completes its restructuring. Coumantaros emphasized that the NGX would remain integral to the company’s future. However, he noted that before relisting, Flour Mills needs to “reorganize, retool, recapitalize, and refocus” to position itself as a leading pan-African food or agro-allied business.
Flour Mills of Nigeria’s $1 billion investment plan demonstrates its commitment to scaling its operations, fostering partnerships, and expanding across the African continent. By leveraging the AfCFTA and focusing on restructuring, the company aims to create a sustainable and diversified pan-African food business.
