Ellah Lakes Plc (ELP) has said that it plans to invest $400 million in capital over the next two years to deliver on its Crop Processing Zone strategy within a Special Economic Zone (SEZ).
Mr. Chuka Mordi, Chief Executive Officer of Ellah Lakes Plc, stated this at the presentation of the company’s Facts Behind the Right Issue in Lagos.
The company recently received approval from the Securities and Exchange Commission (SEC) to raise an additional N2.90 billion in capital via the rights issue.
Special Economic Zone: Mordi noted that ELP is in the process of applying for Special Economic Zone (SEZ) status to cover each of its core operating locations.
According to Mordi, the key benefits and incentives for operating within a Special Economic Zone include:
- “Complete tax holiday from all forms of taxes, rates, and levies, duty-free import of raw materials, capital goods and other inputs for production, Immigration waiver on expatriate quota, businesses are allowed full repatriation of capital, profit, and dividends, among others”
- Infrastructure: He noted that in addition to existing infrastructure, ELP intends to build storage silos, capable of storing up to 10,000 MT of soybean and maize.
- “The storage infrastructure will serve both ELP’s needs as well as those of 3rd party growers within the region and will complement the Federal Government’s strategic grain reserves.
- ELP has active plans to reduce the carbon footprint of its operations. The Company intends to power the SCPZ using renewable energy (water and solar).
- The Company has also commenced discussions with several stakeholders on carbon sequestration projects, with an aim to ensure our overall operations are carbon neutral,” he said.
Mordi noted that Nigeria imports an estimated 340 million liters of ethanol annually, valued at $315 million adding that only 6% of the product is produced locally.
- “The coming upstream of the Dangote Refinery would also result in an increased demand for ethanol in order to ensure the refinery’s output meets EU requirements for ethanol content in the refined product (10-15%).
- ELP has scope to expand into other key cassava by-products that have both high growth potential and relatively easy substitutes/complements to existing food production processes and industrial applications,” he said.
What you should know
Ellah Lakes Plc had received approval from the Securities and Exchange Commission (SEC) to raise an additional N2.90 billion in capital via the rights issue.
According to the statement signed by OAKE Legal (Company Secretary), Ellah Lakes is proposing a Rights Issue of 1,000,000,000 Ordinary Shares of 50 Kobo each at N2.90 Per Share which brings the total value of the capital to N2.90 billion.
Rights issue that did not give us Financial projection especially for a company that did not generate any revenue in the last two or three years. Just piling up debts.
Yet, you want to raise fresh capital without future financial projection.