Dangote Cement Plc has announced the commencement of its share buy-back programme, under the approval granted by the Company’s shareholders at the Extraordinary General Meeting of DCP, held on 21 January 2020.
This announcement was made in a notification issued this morning, the 21 December, before the opening of the stock market. This is also the first share buyback in Nigeria’s stock market history, according to Nairametrics checks.
According to the notification, the Share Buy-Back Programme is in line with 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”).
Key highlights from the notification
- Based on the aforementioned shareholders’ approval, the number of shares to be repurchased under the Share Buy-Back Programme will not exceed 10% of DCP’s issued capital.
- The Programme will be effected in tranches, as the first tranche under the Company’s share buy-back programme will commence on the 30th of December 2020, and will be completed on the 31st of December 2020.
- During this period, the approved brokers of the company would purchase up to 85,202,537 fully paid-up ordinary shares of 50 Kobo each, representing 0.5% of the entire current issued shares of 17,040,507,404 ordinary shares.
The first tranche under the Company’s Share Buy-Back Programme will be executed by Meristem Stockbrokers Limited and Vetiva Securities Limited, the appointed stockbrokers of the Company under the programme. The stockbrokers will at their discretion purchase DCP shares in the open market between 30th and 31st December, subject to prevailing market conditions and under the current daily trading rules of the NSE.
- 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. Execution of this Tranche I is not expected to have any material impact on the Company’s financial position.
What you should know
Nairametrics reported a year ago that the Board of Directors of Dangote Cement Plc announced it would convene an extra-ordinary general meeting (EGM) of shareholders for January 22, 2020, in a bid to obtain shareholders’ approval to amend its Articles of Association, which would enable the Company to undertake a share buy-back of up to 10 percent of its issued shares, in line with the concluded arrangement.
What to expect
- Shareholders seeking to participate in the first Tranche under the Share BuyBack Programme are hereby advised to contact their stockbrokers or any other independent professional adviser registered as a capital market operator by the SEC for further guidance on the submission of trades.
- Dangote Cement will provide weekly updates on the progress of the First Tranche of the Programme on its website over the duration of this tranche.
- However, the Company will continue to monitor the evolving business environment and market conditions, in making decisions on further tranches of the Share Buy-Back Programme.
- Upon the completion of this programme, an announcement will be published on the website of the company and issued on the website of the Nigerian Stock Exchange, in line with the exchange and the company’s policy on full disclosure.