When Dangote Sugar Refinery proposed a daring merger in August 2023 with NASCON Allied Industries and the dormant Dangote Rice, it seemed like a conglomerate tightening its belt, mixing its salt, sugar, and rice companies right into a leaner empire.
Underneath the proposed phrases, NASCON shareholders would surrender 12 NASCON shares in trade for 11 shares of Dangote Sugar.
- For instance, when you owned 120 NASCON shares, you’ll get 110 Dangote Sugar shares in return.
- Dangote Rice shareholders have been to obtain 14 DSR shares for each 1 Dangote Rice share.
The plan seemed good till April 2024, when it all of a sudden fell aside.
The Securities and Trade Fee (SEC) raised issues. Dangote Rice was not operational, so merging it with functioning firms didn’t fairly add up. The deal was formally suspended.
Since then, with the discharge of the 2024 full-year and Q1 2025 outcomes, buyers are left questioning: Did shareholders miss out on an enormous alternative, or did they dodge a loss?
Who would have gained and who dodged a match?
Nascon Allied Industries Plc
By the top of 2024, NASCON’s share worth had fallen by 41.6%, closing the yr at N31.35.
However fast-forward to Could 2025, and the inventory has staged a significant comeback up a whopping 72% year-to-date, now buying and selling at N54.
The corporate didn’t simply bounce again out there, it backed it up with actual efficiency:
- It paid out N1.00 interim dividend in November 2023 and N2.00 ultimate dividend in Could 2025.
- It reported a N23.6 billion pre-tax revenue in 2024, regardless of powerful financial situations.
- In simply the primary quarter of 2025, earnings soared 500% to N11.3 billion, practically half of its 2024 full-year earnings.
Dangote Sugar Refinery Plc
Dangote Sugar confronted some powerful challenges in 2024. By the top of the yr, its share worth had declined by 42.98%, closing at N32.50.
However in 2025, the corporate confirmed indicators of restoration, with a 16.9% year-to-date achieve, bringing the inventory to round N38.
Financially:
- The corporate reported a pre-tax lack of N270.9 billion in 2024, largely attributable to FX losses and excessive curiosity bills
- Encouragingly, it narrowed the loss considerably in Q1 2025, all the way down to N22.6 billion, a step in the fitting route.
- It final paid a dividend of N1.50 per share for the 2022 monetary yr.
Whereas Dangote Sugar nonetheless faces challenges like excessive borrowing prices and thinner margins, its Q1 2025 efficiency suggests it’s making progress towards stabilization.
Had the merger gone via, NASCON shareholders would have exchanged a recovering, dividend-paying inventory for shares in an organization that’s nonetheless in turnaround mode.
The 12-for-11 share swap might have diluted NASCON’s sturdy momentum and tied it to a enterprise nonetheless navigating headwinds.
As a substitute:
- NASCON remained unbiased and worthwhile,
- Paid a complete of N3 in dividends,
- And delivered a powerful 72% share worth achieve in 2025 thus far.
In the meantime, Dangote Sugar is step by step regaining its footing, exhibiting enchancment however nonetheless working to return to its previous energy.
Generally, one of the best offers are those that anticipate the fitting timing.
For now, NASCON shareholders benefited from staying the course, whereas Dangote Sugar continues its path to restoration.
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