PZ’s Nigerian Palm-Oil Venture May Gross ‘Millions’ (Updatet2)
PZ Cussons Plc sees a joint venture to refine and sell palm oil in Nigeria as potentially generating “several hundred million dollars” or more of annual revenue for the two partners, its finance director said.
The U.K. maker of Imperial Leather soap and its venture partner, Singapore’s Wilmar International Ltd., plan to build a plant outside Lagos that will employ a “couple of hundred” workers, Brandon Leigh said in a telephone interview today. He declined to give a time scale for the projected sales.
The Manchester, England-based company and Wilmar, the world’s largest palm-oil trader, are seeking to capitalize on growth in Nigeria, Africa’s second-biggest economy after South Africa. PZ Cussons already employs about 5,000 in the country, where it sells skin- and hair-care products, refrigerators and air conditioners, and milk and yogurt in a venture with Glanbia Plc, Leigh said.
“It’s 160 million people, we have great distribution across Nigeria,” he said. “The PZ name is well known.”
The company’s shares fell 0.9 pence, or less than 1 percent, to 392 pence in London. The stock has gained 45 percent so far this year, giving PZ Cussons a market value of 1.68 billion pounds ($2.6 billion).
The two companies will contract with small farmers and produce brand-name palm oil for cooking, ingredients and butter substitutes, Leigh said.
PZ Cussons is investing about $27 million over two years in the plant, and Wilmar is spending $27.5 million, the companies said in separate releases today.
To contact the editor responsible for this story: Colin Keatinge in London at Ckeatinge@bloomberg.net