Transmar to Buy 40% Stake in Nigeria’s FTN Cocoa Processors

Deal expected to conclude Nov. w/ approval of Nigerian authorities, Akin Laoye, FTN exec director, said in intv. yday.

* Partnership to give FTN greater access to intl markets. High costs of production incl. energy and credit make Nigerian processors uncompetitive internationally;
* “The investment in FTN provides a unique opportunity for both companies to expand our businesses to serve the needs of our international customer base”: Transmar e-mailed statement;
* FTN to start full output this yr at 20k mt-capacity plant that cost 1.6b naira, partly funded by Central Bank of Nigeria commercial agriculture loan. Plant enables FTN to meet Transmar’s supply targets: Laoye;
* FTN forecasts 1b naira 2015 profit from 287m loss in 2013; turnover to rise to 4b naira by end-2015 from 492m naira last yr when halted production for expansion work;
* NOTE: Nigeria 2013 cocoa output 250k t: Cocoa Processors Association of Nigeria;
* NOTE: 8 cos in Nigeria have >200k t processing capacity vs. 16 cos in 2007: Cocoa Assn. Source: Bloomberg