ABN – South Africa’s largest food producer Tiger Brands Ltd. has agreed to sell an indebted Nigerian business back to Dangote Industries Ltd. at a significant loss.
Having bought the 65.7% stake in Tiger Branded Consumer Goods Plc of Nigeria, formerly Dangote Flour Mills, from Dangote for US$200 million three years ago, Tiger will now return the stake for a nominal $1.
Dangote will put $50 million into the transferred company and also settle its debts, which amount to 5.6 billion naira (apx. US$28 million), including writing off the loans worth $46 million that it granted to the operation.
Tiger’s shares rallied by as much as 10% following the sale.
Dangote Industries is owned by Nigerian billionaire Aliko Dangote, who is Africa's richest man.