Notore Chemical Industries Plc has notified its shareholders and the Nigerian Exchange Limited (NGX) that Kwararafa Africa Limited has made an offer to acquire the shares held by the company’s minority shareholders.
The announcement, published on the NGX disclosure page on November 26, was signed by the company’s Secretary, Matthias Ogwuche, reflecting the beginning of a potential shift in Notore’s ownership structure.
According to the statement, Kwararafa Africa Limited is not acting alone, but in partnership with TY Holdings Limited and Notore Chemical Industries (Mauritius) Limited (the “Core Shareholders”), to acquire the remaining shares held by minority investors in Notore Chemical Industries Plc.
The disclosure reads:
“Notore Chemical Industries Plc (the Company) hereby notifies the Nigerian Exchange Limited, the investing public, and our esteemed stakeholders that the Company has received an offer from Kwararafa Africa Limited.”
It further elaborates:
“Kwararafa Africa Limited is acting in concert with TY Holdings Limited and Notore Chemical Industries (Mauritius) Limited (together, the ‘Core Shareholders’) to acquire all the shares currently held by the minority shareholders in Notore, referred to as the ‘Scheme Shareholders.’’
This development marks a notable step in the company’s strategy as it explores the possibility of consolidating ownership under the core shareholders.
What to know
- The proposed transaction is set to be carried out through a scheme of arrangement (the “Scheme”).
- This arrangement will be structured between the company and its shareholders, in compliance with Section 715 of the Companies and Allied Matters Act 2020 (as amended), along with other relevant laws and regulations.
- For the scheme to take effect, it must first be approved by the Securities and Exchange Commission (SEC) and then by the scheme shareholders at a court-ordered meeting. The arrangement must also be sanctioned by the Federal High Court.
- The detailed terms of the scheme will be provided in a formal document, which will be sent to all shareholders after the SEC grants initial approval and the Federal High Court orders a meeting of the shareholders.
- Further updates will be provided to the market as soon as the necessary approvals from the relevant regulatory authorities are obtained.
Performance
Notore Chemical Industries Plc reported a pre-tax loss of N82.1 billion for the third quarter of 2024, reflecting a 191% increase from the N28.2 billion loss reported in the same period last year. This sharp rise in losses was driven by finance costs.
- Revenue also declined, falling from N4.7 billion in Q3 2023 to N191.2 million in Q3 2024.
- For the nine-month period ending September 30, 2024, the company’s total revenue was N598.9 million, with revenue from urea and other chemicals— a major component of its turnover— dropping sharply from N10.8 billion to N206.9 million.
Despite these setbacks, Notore’s shares increased by over 9% as of the market opening on November 26, 2024, reflecting a positive market response to the proposed acquisition.