SMN 5. Benue Cement Company.
March 30th, 2007 Ogbuotobo Chuks || chuks@stockmarketnigeria.com
By Ogbuotobo Chuks
For a better part of its life, Benue Cement Company was moribund due to mismanagement and a huge debt profile.Things however took a new turn with the leadership of Dangote Indusries acquiring 35.39 percent of governments holding in the company in April 2000.
This singular action saw Dangote Industries emerge as core investors of the company. They officially assumed control of the company in January 2004 after due processes had been met.As preparations for commencement began,Dangote Industries had to settle workers’ salary arrears, as well as other creditors. It then partnered with Assopciated Cement Company, an indian technical consulting firm to handle affairs at the operations site.
By March 2005, production capacity had increased to 450,000 tonnes, thereby making a turnover of N4 billion and gross profit of N2.2 billion in 9 months of operation.BCC accessed the capital market in 2005 to raise new equity funds through a rights issue of 1.98 billion shares at N3.50 per share.
Before the takeover by Dangote Industries, the company had suffered a dividend drought of 12 years.
BCC is amongst our top 5 stocks for the year because they have a very sound management with vast experience in manufacturing and production. This is one of the key factors that should be put into consideration, especially when a company is being revived.
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