Food Company Owned by Nigerian Billionaire Invests $200 Million in Sugar Estate
- BUA Foods, owned by one of Nigeria’s wealthiest men, Abdul Samad Rabiu, invested about $200 million in sugar estate
- The estate, located in Kwara state, spans 20,000 hectares and includes a cultural estate, a 20,000 metric tons refinery, and a capacity to crush 15,000
- The company said it took the investment decision to reduce over-reliance on foreign exchange for imports
PAY ATTENTION: The 2024 Business Leaders Awards Present Entrepreneurs that Change Nigeria for the Better. Check out their Stories!
Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.
As part of efforts to reduce dependence on forex, which impacts raw materials, BUA Foods Plc, owned by Nigeria’s second-wealthiest man, Abdul Samad Rabiu, has invested over $200 million in its integrated sugar estate situated in Lafiagi, Kwara state.
The managing director of BUA Foods, Ayodele Abioye, disclosed this during a press briefing at the company’s headquarters in Lagos.
Source: Getty Images
Abioye said that the project, which comprises a sugar refinery, ethanol plant, and supporting infrastructure, aims to address the challenges posed by FX fluctuations in raw-material sourcing.
He said the bulk of the company’s raw materials depend primarily on FX, stating that Nigeria is yet to be an industrialised agriculture producer of sugarcane, a primary source of sugar.
Facilities at the sugar estate
BUA Foods is part of the BUG Group, comprising BUA Sugar Refinery, BUA Oil Mills Limited, IRS Flour, IRS Pasta, and BUA Rice Limited.
The conglomerate is owned by Nigeria’s second-richest man, Abdul Samad Rabiu.
The sugar estate spans 20,000 hectares and includes a cultural estate, a 20,000 metric tons refinery, and a capacity to crush 15,000 tonnes of sugarcane daily.
- The estate also contains:
- An industrial ethanol plant.
- Schools.
- An estate under construction.
- A three-kilometre airport.
BUA Foods reportedly recorded a 74% increase in revenue but faced challenges in strategic planning due to exchange rate volatility and increased exchange rate by the Nigeria Customs Service
Customs FX rates affect operations
Abioye stated that the 59.15% increase to N1,515 per dollar in the exchange rate on February 15 exposed the company substantially.
The Nigerian Customs Service relies on the recommendations of the Central Bank of Nigeria (CBN) for its FX rates, and the recent adjustments are the sixth time in February the apex bank is adjusting FX for cargo clearance.
Billionaire Africa reports that the BUA Foods boss decried difficulty in planning caused by FX volatility, stating that the company experienced four changes in duty exchange rates in one week.
Abioye reassured stakeholders of the company’s active fluctuations management to maintain affordable product prices.
BUA Group approves 50% increase in workers' salaries
Legit.ng reported that Abdul Samad Rabiu, the head of BUA Group, has approved a massive 50% rise in staff compensation across his conglomerate in a significant step to prioritise employees' welfare.
The decision was made public through an internal memo from BUA Group's head of Human Resources, Mohammed Wali.
It followed reports that the price of a 50kg bag of cement rose to about N9,500 in many parts of Lagos and around the country amid the biting effect of inflation in Nigeria.
PAY ATTENTION: Donate to Legit Charity on Patreon. Your support matters!
Source: Legit.ng
