LAGOS (Reuters) - Fertilizer maker Notore Chemical Industries has achieved a 100.75 billion naira ($330 million) valuation by listing on the Nigerian Stock Exchange, with a free float of 16 percent.
Notore, which produces fertilizer for sale within Nigeria and for export to West Africa, Southern Africa and Europe, said it had listed 1.61 billion ordinary shares at 62.50 naira each on Thursday, a day before active trading begins.
The offering will increase access to capital to fund its growth plans, Notore’s Chief Executive, Onajite Okoloko told stockbrokers during the listing.
The company, which also has interests in power, food and seed production, said in a presentation that 75 percent of its urea fertilizer is sold at home with the balance exported to traders in Europe such as Helm AG, Ameropa and Yara.
Agriculture accounts for 20 percent of Nigeria’s gross domestic product with crop production contribution the highest with the farming subsector.
However, low fertilizer production and the high cost of importing fertilisers has limited seed production. Fertilizer consumption in Nigeria ranks below its African peers at around 100 kilogram per hectare, Notore said.
Africa’s richest man Aliko Dangote is developing a 1.5 million tonne fertilizer plant in Nigeria’s commercial hub of Lagos, which he expects to commission by end of the year.
Singapore-owned Indorama Eleme Petrochemicals Ltd, is seeking to double its Nigerian plant annual output of urea fertilizer to 2.8 million tonne, and plans to list in Lagos next year.
Notore acquired the assets of state-owned fertilizer company National Fertilizer Company of Nigeria, based in the Niger Delta for $152 million more than 10 years ago and in 2012 entered into a joint venture with Mitsubishi Corporation to develop a new fertilizer plant, it said in the presentation.
It now has Africa Finance Corporation (AFC) as one of its shareholders with 4.9 percent holding. More than half of the shares are held by a vehicle registered in Mauritius.
Notore has the capacity to produce 500,000 metric tonnes per annum of urea, it said and also develops and sells staple crops such as maize and rice.
Its narrowed its loss before tax to 2.15 billion naira for 2017 from 12.2 billion naira the year before. However, turnover grew to 35.89 billion naira, from 25.20 billion naira.
Additional reporting and writing by Chijioke Ohuocha; Editing by Kirsten Donovan/Jan Harvey/Alexander Smith