Friday, 21 June 2024 04:52

Exits of multinationals gather pace as Indian steel maker prepares to leave Nigeria

Rate this item
(0 votes)

Indian steel maker, Aarti, is exiting the Nigerian manufacturing sector, joining a long list of companies leaving the country on account of economic woes.

The Ota, Ogun State-based steel maker, has already been put up for sale and big players have submitted unconfirmed bids ranging between $50 million and $100 million.

The steel maker’s exit is attributed to a combination of factors, notably high rate of indebtedness, challenging economy, fluffing currency, surging inflation and high energy cost, a source who spoke on condition of anonymity told BusinessDay.

“We are aware that Aarti Steel Nigeria has been put up for sale but we are yet to make our bid,” a reliable source from one of the bidding companies, who is not authorised to speak on the issue, said.

According to the source, African Industries and Bharti are bidding to buy the Indian-owned steel manufacturer for $50 million to $100 million. The process is expected to be completed in a few months.

The company is asking investors to submit their profiles, another source noted, saying that the management of the company wants to hand over Aarti to a credible investor.

This will make it the sixth company to exit Nigeria in the first half of 2024 after Microsoft Nigeria, Total Energies Nigeria, PZ Cussons Nigeria PLC, Kimberly-Clark Nigeria and Diageo PLC left the shores of Africa’s most populous nation.

The exit of Aarti will further dent the country’s perception as an investment destination and its $1 trillion gross domestic product (GDP) target, experts weigh in.

“The continuous exiting of multinationals from the economy is a serious cause for concern and this is because of the implication that it has,” said Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise.

“It has a negative implication for employment and the country’s perception as an investment destination,” Yusuf added.

In 2017, Aaarti spent $20 million to $30 million to establish a 120,000-capacity cold-rolled mill in Ota, Ogun State, to serve Nigeria’s downstream players using the steel to produce home appliances, roofing sheets, metal furniture and filing cabinets, tables and chairs, among others.

But the investment does not seem to matter much now.

 

Businessday

June 28, 2025

Nigeria experiences sharp decline in Foreign Investment as FDI fell 19% in Q1 2025

Nigeria’s appeal to foreign investors continued to wane in the first quarter of 2025, with…
June 26, 2025

Peter Obi decries ‘coordinated lawlessness’ after brother’s property is demolished in Lagos without court order

Former presidential candidate Peter Obi has condemned what he described as a brazen act of…
June 28, 2025

7 genius responses to ‘put rude people in their place,’ according to communication experts

Kathy & Ross Petras Rude people are, sadly, all around us. We deal with them…
June 21, 2025

Man convicted of posing as flight attendant to fly for free 120 times

A 35-year-old American man has been found guilty of impersonating a flight attendant at least…
June 26, 2025

17 soldiers killed, dozens injured in fierce gun battles with terrorists in Niger, Kaduna

Seventeen soldiers have been confirmed dead and at least ten others injured following coordinated attacks…
June 28, 2025

Here’s the latest as Israel-Hamas war enters Day 631

Battling to survive, Hamas faces defiant clans and doubts over Iran Short of commanders, deprived…
June 25, 2025

Tesla robotaxi launch: Why getting from dozens to millions of self-driving cars won't be easy

Tesla (TSLA.O) finally has a robotaxi. Now comes the hard part. The electric-vehicle maker deployed…
May 13, 2025

Nigeria's Flying Eagles qualify for World Cup after dramatic win over Senegal

Nigeria's U-20 national football team, the Flying Eagles, have secured their place at the 2025…

NEWSSCROLL TEAM: 'Sina Kawonise: Publisher/Editor-in-Chief; Afolabi Ajibola: IT Manager;
Contact Us: [email protected] Tel/WhatsApp: +234 811 395 4049

Copyright © 2015 - 2025 NewsScroll. All rights reserved.