Olam International has acquired a 51.0% interest in Togo’s state-owned cotton company, Nouvelle Société Cotonnière du Togo (NSCT or the JV), for a consideration of EUR15.3 million ($24.4 million).

The global food and agri-business, on Nov 20, has signed a share purchase agreement for the company’s equity stake on a cash free, debt free basis and closing net working capital of some EUR19.1 million.

Following the transaction, the Togolese Republic and the national cotton farmers cooperative Federation Nationale des Groupements de Producteurs de Coton du Togo will hold a 24.0% and 25.0% stake in the JV respectively.

See: Olam International secures Singapore's first SORA-pegged club loan of $200 mil with DBS and ICBC

NSCT oversees all cotton-related activities in Togo, including engaging with farmers, ginning, sales and the marketing of cotton and cottonseed.

The privatisation of NSCT has been authorised by the law.

Olam says the acquisition will be funded by a mix of internal accruals and existing debt facilities. The transaction is expected to be completed by December 2020, and is not expected to have a material impact on Olam’s consolidated net tangible assets and earnings per share for the FY ending Dec 31, 2020.

As at 4pm, shares in Olam are trading 5 cents higher or 3.7% up at $1.42.