Shareholders approves Dangote Cement’s buyback plan
- Say plan to boost share price
By Omobayo Azeez
Shareholders of Dangote Cement Plc, have given their approval to a proposal by the board of the company to ‘buy-back’ up to 10 per cent of its shares from the stock market.
The 10 per cent is equivalent to 1.7 billion units of its entire 17.04 billion issued and fully paid-up ordinary shares of 50 kobo each.
While lauding the board for the plan, the shareholders who spoke at an extraordinary general meeting (EGM) on Wednesday noted that the proposal will enhance the share value while ensuring higher returns on investment (RoI).
The company had explained that the share buy-back scheme will be on terms and conditions of the programme which will be completed within 12 months from the EGM date, as stated by the directors.
The proposal, he noted, is coming almost 12 years after the ISAN, under his leadership, sponsored “a seminar on share buy-back because of its value and importance.
“As shareholders, we have been clamoring for share buy-back for so many years, and today Aliko Dangote has given us hop.
“This is very good as against the practice of share deconstruction that is being practiced by some Nigerian companies which never gives back anything positive to the shareholders.
“The ‘share buyback’ was practiced in Ghana with just a few companies listed on its Exchange. We are indeed very happy with this and we are also quite sure that with this that you have done today, you have proved yourself to be the best chairman of all the corporate companies in Nigeria.
“We will not disappoint you. We are very delighted because we know that, this arrangement will lead to share price increase and more dividends for the shareholders,” he stressed.
Also speaking, Alhaji Mohammed Audu president of Authentic Nigerian Shareholders Association, , expressed hope that the money realized from the share buyback by the shareholders will be used for investment purposes.
“The share buy-back will ensure that the value of our share will go up and we are also sure of getting better dividends. So, as you can see, all the shareholders here today voted unanimously in support of the motion. We voted for it and also thank Aliko Dangote for making us richer,” he added.
By the share buyback arrangement, the shares will be repurchased from the company’s retained earnings, after which the shares repurchased under the programme will be canceled in accordance with rules of the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange Rulebook 2015, which will consequently lead to a reduction in issued share capital.