Dangote flour ‘plunging’ after resignations

The market value of Dangote Flour mills equity plunged on Monday, following the resignation of Africa’s richest man, Aliko Dangote.

On Monday, Tiger Brands of South Africa announced its decision to cease funding its Nigerian subsidiary, Dangote Flour, co-owned by Dangote.

The announcement saw the market shares plunging by over 4.74 percent, with the downward movement continuing early on Tuesday.

Though the volume of trade on the Nigerian Stock Exchange(NSE) on the equity  increased from 6,050 on Friday to 769,431 on Monday, November 16, the stock still took a downward turn.

In a statement available to TheCable, the company had urged shareholders to trade with caution, following its decision to review its economic stance about the billion naira outfit.

“Shareholders are advised that Tiger Brands Limited has informed the Board of Directors of Tiger Branded Consumer Goods PLC., that Tiger Brands Limited has reached a decision not to provide any further financial support with respect to its investment in Tiger Branded Consumer Goods PLC,” the statement said.

“Shareholders are also advised that Aliko Dangote, Olakunle Alake, Asue Ighodalo and Arnold Ekpe have resigned their appointments as directors of Tiger Branded Consumer Goods PLC.

“The Board of Directors of Tiger Branded Consumer Foods PLC. is considering the implications of these developments for the Company, and further information will be communicated in due course.

“In the meantime, shareholders are advised to exercise caution when dealing in the company’s securities until a further announcement is released.”

Though experts say this may be the end of the road for Dangote flour, the mother company says it is currently exploring various alternatives with regard to its investment in the company.

Tiger Brands has large equity stakes in leading Nigerian companies including Deli Foods and UAC Foods.