Honeywell Flour Mills Plc has disclosed plans to invest N10 billion on the company’s new Agro-Allied Industrial Complex as part of efforts to develop the company’s production capacity.
Managing Director, Mr. Lanre Jaiyeola, stated this at a tour of the company’s factory in Lagos by stockbrokers.
He said that work has already commenced on the first phase of the project.
He said bulk of the money required for the investment will be raised through equity, while talks have also commenced with financial institutions like the Bank of Industry for financing.
According to Jaiyeola, upon completion, the new agro-allied industrial complex sited on a 62.8 hectare of land situated around the Sagamu Inter-change in Ogun State, will be the food basket for the entire Honeywell Group.
Speaking further, he noted that by design, the project is a cluster for production and processing of general food and agro-allied products with emphasis on manufacturing value-added human and animal food products leveraging backward integration for raw material procurement.
His words, “We plan not only to have product extension, but also to go into the other areas of agric business that will ensure that we focus more on backward integration which is the bigger picture in the Honeywell Group and we are pursuing this already.
“Recently, we acquired a 62.8 hectare land in Sagamu inter-change for the expansion of our production and we hope that upon completion of the project, we will not only be increasing our capacity, but Honeywell will also increase its contribution to Nigeria’s Gross Domestic Products (GDP) as the Food Village will open employment opportunities for several Nigerians.”
Speaking on the company’s preparedness to meet the federal government’s deadline of five percent cassava inclusion level in its wheat flour by December 2014, he said; “the position of Honeywell in this regard is that it is a welcome development, received wholeheartedly.
“We have our own strategy to ensure that for our company, the initiative is a success. But today, we face the challenge of high quality cassava flour availability. The truth today is that we have doubt as to the ability of our partners (cassava processors) to meet up with the supply of high quality cassava. We are already seeing these signs because we see default in delivery on orders.
“We also hope that government will play its role in supporting not only the processors but also the farmers in ensuring that the programme subsequently does not suffer setback. This, they can do through cassava introduction and empowerment of the growers.”
Speaking on behalf of other stockbrokers, General Manager, Compass Investments & Securities Limited, Mr. Sam Ndata, pledged their unalloyed support to the company.
He urged the company to approach the capital market for the huge capital required for the new investment, assuring them that the brokers will give the company the required support to raise enough funds, adding that equity financing is the best way to grow business.
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