Last Wednesday, August 26, The PUNCH newspaper carried a story on its inside pages of workers protesting the continued closure of their cocoa-processing factory by Asset Management Corporation. ‘Workers protest factory closure, beg AMCON’ read the headline. The factory, Multi-trex Integrated Foods Plc, has been shut down by AMCON since June 26, after prolonged AMCON intervention (since 2011) that failed to restore the ailing company to good health.The Multi-trex case is a sad one. The company, within a very short space of its existence, became the exemplar of indigenous industry, showcase-able to the world of what Nigerians are capable of achieving if they put their minds to it. Multi-trex stood tall and clean, growing with impressive gallop to put an end to the anomaly of the country exporting its raw materials only to reimport them as foreign manufactured products.Multi-trex, from its very humble one-man cocoa business beginning of some years back, grew to employing hundreds of workers from the lowly unskilled to the highly skilled and management cadre, and becoming listed on the Nigerian Stock Exchange a few years ago to earn the PLC like a badge of protection it should be but isn’t. Conspicuous on the Lagos-Ibadan Expressway, the huge factory complex (on the left-hand side right after the famous “longest bridge” on leaving Lagos), was a beehive of activities and bubble until a couple of months ago when the “bubble burst” literally, with red inscriptions all over its walls visible from the expressway affirming the surreal lifelessness of the factory on the orders of the almighty AMCON.Let me quickly make a necessary disclosure: I am related to the founder/CEO of the company in question by marriage. Mr. Dimeji Owofemi is married to my niece, Monisola, whose mum, Mrs. Ajibike Ayeni (nee Fagbenle), is my eldest sister. But I assure my readers that my “intervention” in this matter is based on what I know of the company and what I believe the company represents for Nigeria and Nigeria’s desire to stimulate indigenous manufacturing.To move on, manufacturing business in Nigeria is almost tantamount to masochism; a business meant for those who simply enjoy inflicting pain upon themselves. Generally, it is treacherous and, depending on its scale, it is even a foolhardy adventure considering the myriad of peculiarly Nigerian hurdles, human and systemic, to surmount.But as far as the protesting Multi-trex workers are concerned, AMCON is the ‘bad guy’ that has come to deprive them of their livelihood. Some of the placards read: “AMCON please settle with our management and save our posterity;” “Save our families from hunger and increasing debt;” “We are willing to work, AMCON please reopen our factory;” etc. Multi-trex Management also views AMCON’s intervention that has now ended in the shutdown of the factory as premature, extreme, and unfortunate. The former Management of AMCON is blamed for this and an ulterior motive is impugned, which Multi-trex hopes the in-coming AMCON leadership should be wary of, lest it got misadvised into perpetuating an “injustice” and killing indigenous entrepreneurship that should be encouraged and supported.The nature and scale of the Multi-trex business deserves a little bit of mention to understand the magnitude of business entrepreneurship at stake. It is a wholly indigenous company with over 1,000 Nigerian shareholders. The installed capacity of its two factories, with 65,000 metric tonnes, cocoa processing equipment and machinery for manufacturing chocolate bars, chocolate drinks, etc, is the largest in the country. The first factory, launched by President Olusegun Obasanjo in 2006 has 15,000 tonnes capacity. The second factory also on the same site has a capacity for 50,000 tonnes. I am proud to say I was present and participated at its launch in 2009; jointly opened by Pastor E. A. Adeboye (General Overseer of The Redeemed Christian Church of God), and Alhaji Sa’ad Abubakar, the Sultan of Sokoto, and witnessed by Governor Gbenga Daniel.The company’s production of chocolate bars and spread was inaugurated in 2012 by President Goodluck Jonathan, and it has a capacity to produce over 30 million pieces of 16.5g bars per annum. Its chocolate beverage powder drink plant was inaugurated in 2013 by the then Minister of Agriculture, Dr. Akinwumi Adesina, now President-elect of African Development Bank. Its recently completed chocolate beverage liquid drink plant will manufacture over 16 million units of 30cl plastic bottles chocolate drink per annum.Apparently, Multi-Trex, as to be expected, owed banks hugely, the severest being N8.5 billion unpaid loans owed Skye Bank as of 2011. AMCON came in then and bought over the Skye Bank loan. Multi-Trex finance man, David Obijole, argued that the move was wrong in the first place as the company was still servicing the loan when AMCON bought it. “AMCON was supposed to buy non-performing loans from banks,” he says in the statement published in The PUNCH. “But our company’s loan was still performing when AMCON bought it over from Skye Bank Plc.”Matters became complicated as a result of later CBN directive, barring banks from further lending to companies indebted to AMCON above N5m. Multi-Trex operations became stifled and asphyxiated, a position corroborated by Mrs. Mobola Sanya, Head, Human Capital and Administration Services. “The company has been handicapped since 2011 when AMCON bought over our loan facility,” she said. “The company has not been able to access working capital thereby unable to pay back the debt it is owing AMCON. This has led to mass retrenchment of over 200 workers of the company and 50 other employees have been sent on compulsory leave without pay. About 70 staff members have not been paid salaries for 11 months. This has brought hardship to the affected workers and their numerous dependants with attendant loss of revenue to the country through export and foreign exchange generation.”PROSHARE, a financial information, intelligence and analyst services firm that claims to have investigated the Multi-Trex case, says on its portal: “That Multi-Trex Integrated Foods Plc, the flagship of the Nigerian cocoa-processing sub-sector, is today closed for business is unimaginable, with about 200 persons rendered unemployed and the modern processing plant and equipment exposed to vandalisation and disuse.“What immediately stood out as we embarked on this exercise was the undeniable trail of ‘institutional failures’ that laid the foundation for the shut-down of an otherwise viable entity and the wrongful tagging of an otherwise quality management that can hold its own within the ‘Trade Finance’ community as inept.” It went further: “The questions, concerns and inquisition were many. So, what went wrong? Who was culpable? How could a company that raised so much money, had an ultra-modern firm launched by the President, State Governor and Bank executives get to a stage of stagnation? What happens to investors now? The more we searched for answers, the more we saw how a series of policy changes, administrative inertia and indifference frustrated a well-intentioned entrepreneurial endeavour, a situation not helped by the regulatory framework that allowed the transfer of a performing loan to AMCON where new financial rules ensured it had no access to working capital legitimately.”Proshare corroborates Obijole’s opinion above, saying, “The (Multi-Trex’s) downturn was precipitated by the decision of Skye Bank Plc to place the Multi-Trex expansion-driven long-term loan with AMCON at a time it was performing which in consonance, the bank justified was motivated by the “…need to free-up liquidity for the bank, especially on the long dated exposure.”It continued in its blistering damnation of the system that kills that which should be protected: “This Multi-Trex case therefore offers much more than a story about the collapse of a company – it is the ultimate poster sign of all that was wrong with our financial markets, regulatory environment (lack of nexus between fiscal and monetary policies driving economic goals) and harnessing of resources to build a non-oil economy for Nigeria.”What is required now is whatever can save a company like Multi-Trex from going under. The new AMCON leadership could investigate and take a more lenient look. So, could the Central Bank of Nigeria provide a waiver, probably with the intervention of the Presidency in the manner it has done for the “distressed” states? Multi-Trex represents more than itself and the hundreds of workers and their dependants whose livelihoods are on the line.It is, as PROSHARE says, “The flagship of the Nigerian cocoa-processing sub-sector.” It deserves to live for all our sakes. And that’s saying it the way it is!

http://www.punchng.com/columnists/tunde-fagbenle-saying-it-the-way-it-is/multi-trex-the-cocoa-factory-that-must-not-die/

Why industry no dey survive for Nigeria

Omooba77:
Why industry no dey survive for Nigeria

Am a banker, business man and an Agric Investor so I'd quickly let you know from my depth of experience.
1. Nigerian Banks have short loan appetite and unwilling to do long term loans, they prefer short loans that would assist them in declaring whooping profits yearly.
2. Most Nigerians are not financially honest, when packaging loans, 9 out of 10 would get diverted to somewhere else.
3. The cost of Production is very high due to cost of power generation, the cost of diesel is good enough to be declared as profit.
4. The loan was wrongly taken as that loan should have been routed through BOI and BOA, they are the ones built for such long term loans, so the loan has gone delinquent even before it was disbursed, hence the reason Skye was more than willing to offload very quickly.

To go into businesses most especially in large scale you need not only a financial advisor but a very sound banker by your side.. . Always.

Gadgetmobil:


Am a banker, business man and an Agric Investor so I'd quickly let you know from my depth of experience.
1. Nigerian Banks have short loan appetite and unwilling to do long term loans, they prefer short loans that would assist them in declaring whooping profits yearly.
2. Most Nigerians are not financially honest, when packaging loans, 9 out of 10 would get diverted to somewhere else.
3. The cost of Production is very high due to cost of power generation, the cost of diesel is good enough to be declared as profit.
4. The loan was wrongly taken as that loan should have been routed through BOI and BOA, they are the ones built for such long term loans, so the loan has gone delinquent even before it was disbursed, hence the reason Skye was more than willing to offload very quickly.

To go into businesses most especially in large scale you need not only a financial advisor but a very sound banker by your side.. . Always.

Please let this great company no die;help talk to MD to allow loan for this venture

Moderator pls, pushed this to the front page.

Gadgetmobil:


Am a banker, business man and an Agric Investor so I'd quickly let you know from my depth of experience.
1. Nigerian Banks have short loan appetite and unwilling to do long term loans, they prefer short loans that would assist them in declaring whooping profits yearly.
2. Most Nigerians are not financially honest, when packaging loans, 9 out of 10 would get diverted to somewhere else.
3. The cost of Production is very high due to cost of power generation, the cost of diesel is good enough to be declared as profit.
4. The loan was wrongly taken as that loan should have been routed through BOI and BOA, they are the ones built for such long term loans, so the loan has gone delinquent even before it was disbursed, hence the reason Skye was more than willing to offload very quickly.

To go into businesses most especially in large scale you need not only a financial advisor but a very sound banker by your side.. . Always.

what about raising money on stock exchange instead

Gadgetmobil:


Am a banker, business man and an Agric Investor so I'd quickly let you know from my depth of experience.
1. Nigerian Banks have short loan appetite and unwilling to do long term loans, they prefer short loans that would assist them in declaring whooping profits yearly.
2. Most Nigerians are not financially honest, when packaging loans, 9 out of 10 would get diverted to somewhere else.
3. The cost of Production is very high due to cost of power generation, the cost of diesel is good enough to be declared as profit.
4. The loan was wrongly taken as that loan should have been routed through BOI and BOA, they are the ones built for such long term loans, so the loan has gone delinquent even before it was disbursed, hence the reason Skye was more than willing to offload very quickly.

To go into businesses most especially in large scale you need not only a financial advisor but a very sound banker by your side.. . Always.

I partially agree with u.

But as a finance expert and a seasoned accountant, I will always fault the decision of corporations to finance long term expansion projects with debt capital, especially when other options like IPOs and private placements are readily available.

I am not saying that borrowing is wrong. But in a highly volatile operating environment like naija, it is always safer to finance expansion using lower risk (to the company) sources of fund like equity.

It would have been better to finance their working capital using debt.

Companies whose statement of financial position portrays long term gearing are not always favorably considered

obstead200:


I partially agree with u.

But as a finance expert and a seasoned accountant, I will always fault the decision of corporations to finance long term expansion projects with debt capital, especially when other options like IPOs and private placements are readily available.

I am not saying that borrowing is wrong. But in a highly volatile operating environment like naija, it is always safer to finance expansion using lower risk (to the company) sources of fund like equity.

It would have been better to finance their working capital using debt.

Companies whose statement of financial position portrays long term gearing are not always favorably considered

Capital market is the only sure bet, but with the recent happenings, many have apartheid towards it

Now is not the time for anything cocoa/agriculture to be in this type of long story something should be done about it abeg.

Gadgetmobil:


Am a banker, business man and an Agric Investor so I'd quickly let you know from my depth of experience.
1. Nigerian Banks have short loan appetite and unwilling to do long term loans, they prefer short loans that would assist them in declaring whooping profits yearly.
2. Most Nigerians are not financially honest, when packaging loans, 9 out of 10 would get diverted to somewhere else.
3. The cost of Production is very high due to cost of power generation, the cost of diesel is good enough to be declared as profit.
4. The loan was wrongly taken as that loan should have been routed through BOI and BOA, they are the ones built for such long term loans, so the loan has gone delinquent even before it was disbursed, hence the reason Skye was more than willing to offload very quickly.

To go into businesses most especially in large scale you need not only a financial advisor but a very sound banker by your side.. . Always.

You made valid points and one must also add that the unfavourable Nigerian business enviroment due to:
1. Unstable government policies and regulations
2. Problem of infrastructure,number one of which is power
are other major factors that will make majority of even long term loans with single digit interest go bad.

myrates:

You made valid points and one must also add that the unfavourable Nigerian business enviroment due to:
1. Unstable government policies and regulations
2. Problem of infrastructure,number one of which is power
are other major factors that will make majority of even long term loans with single digit interest go bad.

Please let PMB use body language reopen this factory.It must not die.

something should be done about multi Trex.... it use to be the best in Nigeria

have worked there before... according to rumour, I heard the management team killed the company due to their jumbo pay. I heard one 'action' woman like that recieve almost 1.5million per month in a growing company pop...
They sucked the breast of the company flat. I enjoyed the Friday church service we use to have there. I pray God give Mr. Femi's wisdom to put the company back to life

what they need now is political intervention... I think the owner is more on PDP. He should try link up with the topguns in the APC. . Like Jagaban

Omooba77:
Last Wednesday, August 26, The PUNCH newspaper carried a story on its inside pages of workers protesting the continued closure of their cocoa-processing factory by Asset Management Corporation. ‘Workers protest factory closure, beg AMCON’ read the headline. The factory, Multi-trex Integrated Foods Plc, has been shut down by AMCON since June 26, after prolonged AMCON intervention (since 2011) that failed to restore the ailing company to good health.The Multi-trex case is a sad one. The company, within a very short space of its existence, became the exemplar of indigenous industry, showcase-able to the world of what Nigerians are capable of achieving if they put their minds to it. Multi-trex stood tall and clean, growing with impressive gallop to put an end to the anomaly of the country exporting its raw materials only to reimport them as foreign manufactured products.Multi-trex, from its very humble one-man cocoa business beginning of some years back, grew to employing hundreds of workers from the lowly unskilled to the highly skilled and management cadre, and becoming listed on the Nigerian Stock Exchange a few years ago to earn the PLC like a badge of protection it should be but isn’t. Conspicuous on the Lagos-Ibadan Expressway, the huge factory complex (on the left-hand side right after the famous “longest bridge” on leaving Lagos), was a beehive of activities and bubble until a couple of months ago when the “bubble burst” literally, with red inscriptions all over its walls visible from the expressway affirming the surreal lifelessness of the factory on the orders of the almighty AMCON.Let me quickly make a necessary disclosure: I am related to the founder/CEO of the company in question by marriage. Mr. Dimeji Owofemi is married to my niece, Monisola, whose mum, Mrs. Ajibike Ayeni (nee Fagbenle), is my eldest sister. But I assure my readers that my “intervention” in this matter is based on what I know of the company and what I believe the company represents for Nigeria and Nigeria’s desire to stimulate indigenous manufacturing.To move on, manufacturing business in Nigeria is almost tantamount to masochism; a business meant for those who simply enjoy inflicting pain upon themselves. Generally, it is treacherous and, depending on its scale, it is even a foolhardy adventure considering the myriad of peculiarly Nigerian hurdles, human and systemic, to surmount.But as far as the protesting Multi-trex workers are concerned, AMCON is the ‘bad guy’ that has come to deprive them of their livelihood. Some of the placards read: “AMCON please settle with our management and save our posterity;” “Save our families from hunger and increasing debt;” “We are willing to work, AMCON please reopen our factory;” etc. Multi-trex Management also views AMCON’s intervention that has now ended in the shutdown of the factory as premature, extreme, and unfortunate. The former Management of AMCON is blamed for this and an ulterior motive is impugned, which Multi-trex hopes the in-coming AMCON leadership should be wary of, lest it got misadvised into perpetuating an “injustice” and killing indigenous entrepreneurship that should be encouraged and supported.The nature and scale of the Multi-trex business deserves a little bit of mention to understand the magnitude of business entrepreneurship at stake. It is a wholly indigenous company with over 1,000 Nigerian shareholders. The installed capacity of its two factories, with 65,000 metric tonnes, cocoa processing equipment and machinery for manufacturing chocolate bars, chocolate drinks, etc, is the largest in the country. The first factory, launched by President Olusegun Obasanjo in 2006 has 15,000 tonnes capacity. The second factory also on the same site has a capacity for 50,000 tonnes. I am proud to say I was present and participated at its launch in 2009; jointly opened by Pastor E. A. Adeboye (General Overseer of The Redeemed Christian Church of God), and Alhaji Sa’ad Abubakar, the Sultan of Sokoto, and witnessed by Governor Gbenga Daniel.The company’s production of chocolate bars and spread was inaugurated in 2012 by President Goodluck Jonathan, and it has a capacity to produce over 30 million pieces of 16.5g bars per annum. Its chocolate beverage powder drink plant was inaugurated in 2013 by the then Minister of Agriculture, Dr. Akinwumi Adesina, now President-elect of African Development Bank. Its recently completed chocolate beverage liquid drink plant will manufacture over 16 million units of 30cl plastic bottles chocolate drink per annum.Apparently, Multi-Trex, as to be expected, owed banks hugely, the severest being N8.5 billion unpaid loans owed Skye Bank as of 2011. AMCON came in then and bought over the Skye Bank loan. Multi-Trex finance man, David Obijole, argued that the move was wrong in the first place as the company was still servicing the loan when AMCON bought it. “AMCON was supposed to buy non-performing loans from banks,” he says in the statement published in The PUNCH. “But our company’s loan was still performing when AMCON bought it over from Skye Bank Plc.”Matters became complicated as a result of later CBN directive, barring banks from further lending to companies indebted to AMCON above N5m. Multi-Trex operations became stifled and asphyxiated, a position corroborated by Mrs. Mobola Sanya, Head, Human Capital and Administration Services. “The company has been handicapped since 2011 when AMCON bought over our loan facility,” she said. “The company has not been able to access working capital thereby unable to pay back the debt it is owing AMCON. This has led to mass retrenchment of over 200 workers of the company and 50 other employees have been sent on compulsory leave without pay. About 70 staff members have not been paid salaries for 11 months. This has brought hardship to the affected workers and their numerous dependants with attendant loss of revenue to the country through export and foreign exchange generation.”PROSHARE, a financial information, intelligence and analyst services firm that claims to have investigated the Multi-Trex case, says on its portal: “That Multi-Trex Integrated Foods Plc, the flagship of the Nigerian cocoa-processing sub-sector, is today closed for business is unimaginable, with about 200 persons rendered unemployed and the modern processing plant and equipment exposed to vandalisation and disuse.“What immediately stood out as we embarked on this exercise was the undeniable trail of ‘institutional failures’ that laid the foundation for the shut-down of an otherwise viable entity and the wrongful tagging of an otherwise quality management that can hold its own within the ‘Trade Finance’ community as inept.” It went further: “The questions, concerns and inquisition were many. So, what went wrong? Who was culpable? How could a company that raised so much money, had an ultra-modern firm launched by the President, State Governor and Bank executives get to a stage of stagnation? What happens to investors now? The more we searched for answers, the more we saw how a series of policy changes, administrative inertia and indifference frustrated a well-intentioned entrepreneurial endeavour, a situation not helped by the regulatory framework that allowed the transfer of a performing loan to AMCON where new financial rules ensured it had no access to working capital legitimately.”Proshare corroborates Obijole’s opinion above, saying, “The (Multi-Trex’s) downturn was precipitated by the decision of Skye Bank Plc to place the Multi-Trex expansion-driven long-term loan with AMCON at a time it was performing which in consonance, the bank justified was motivated by the “…need to free-up liquidity for the bank, especially on the long dated exposure.”It continued in its blistering damnation of the system that kills that which should be protected: “This Multi-Trex case therefore offers much more than a story about the collapse of a company – it is the ultimate poster sign of all that was wrong with our financial markets, regulatory environment (lack of nexus between fiscal and monetary policies driving economic goals) and harnessing of resources to build a non-oil economy for Nigeria.”What is required now is whatever can save a company like Multi-Trex from going under. The new AMCON leadership could investigate and take a more lenient look. So, could the Central Bank of Nigeria provide a waiver, probably with the intervention of the Presidency in the manner it has done for the “distressed” states? Multi-Trex represents more than itself and the hundreds of workers and their dependants whose livelihoods are on the line.It is, as PROSHARE says, “The flagship of the Nigerian cocoa-processing sub-sector.” It deserves to live for all our sakes. And that’s saying it the way it is!

http://www.punchng.com/columnists/tunde-fagbenle-saying-it-the-way-it-is/multi-trex-the-cocoa-factory-that-must-not-die/

Efcc shld peep into d Board of Directors bank Account that is where all d money went.

billyG:

Efcc shld peep into d Board of Directors bank Account that is where all d money went.

How time fly, it ia almost a year now.Nothing done.It is as good as dead,I pass through most time. Another source of employment gone down the drain

Another year gone by.
What has happen to multi-trex?

What is the hope of industrialising this country? I read about China giving long term interest free loan to fresh graduates as start ups.....here we are looking away to let ours waste away..... I know how expensive those imported chocolate bars are now..... Sadly our local competitors has folded up. Is this really a country?

I am in total support that multi trex should be reopened

Biotics:
I am in total support that multi trex should be reopened

Oga Juton, u don reach here? lol!

Biotics:
I am in total support that multi trex should be reopened

No one to listen to you, though you have a very good case.

Tonnes of cassava, ginger, turmeric, yam, pkn, pko etc for sale at a very wonder cheap price. Note, you dont have to spend your money on transportation, we do that for you. And also we deliver the goods before you pay. What a rare and great offer. Waiting for you to place Order. See my signature to contact me

According to Channels news, Multi trex is sorting out its problems with AMCON and should soon be on it's way back to relevance.

delpee:
According to Channels news, Multi trex is sorting out its problems with AMCON and should soon be on it's way back to relevance.

Thank God, anytime I get to any duty free shop at any airport, I remember Multi trex. God will help them