Dangote Cement to be Nigeria's biggest listed firm

By Chijioke Ohuocha

LAGOS (Reuters) - Nigeria's biggest cement maker Dangote Cement will list on the stock exchange on November 5 after a planned merger with Benue Cement, creating the country's largest company by market capitalisation ahead of an anticipated building boom.

The deal values the newly-formed Dangote Cement Plc at around $14 billion through the listing of 15.5 billion shares at a price of 135 naira. Benue Cement shareholders will receive one share for every two Benue shares held, according to a statement from the stock exchange.

Merger documents seen by Reuters said shares in Benue Cement, which were already trading at the pre-merger price of 67.50 naira on Tuesday, would be suspended on October 22 before trading in Dangote Cement shares begins on November 5.

The newly listed company, owned by billionaire tycoon Aliko Dangote, will account for more than a third of the total capitalisation of the Nigerian Stock Exchange, which currently stands at 5.94 trillion.

Dangote, one of only two Nigerians on the Forbes billionaires list, already owns 75 percent of Benue and the stake of his Dangote Group in the new entity will rise to 95.9 percent after the deal.

A source close to the deal said Dangote would sell some shares to the public as a stock exchange listing requires a minimum 25 percent free float.

The merger stills needs final approval from shareholders in both companies and from the Securities and Exchange Commission.

"The primary objective of the merger is to streamline the management and governance of both companies," Dangote said in a letter to shareholders in the two firms, adding that all the necessary pre-merger approvals had been received.