Singapore based agribusiness Olam International has put in a N130bn ($362m) cash bid for Nigeria’s Dangote Flour Mills (DFM), as it seeks to expand in West Africa. The bid includes five flour and pasta production factories operated by DFM and makes Olam the largest wheat miller in Nigeria.

Dangote Flour Mills (DFM), part of Nigerian industrial conglomerate Dangote Group, is Nigeria’s leading wheat miller. Dangote Flour Mills was previously owned by South Africa’s Tiger Brands, but sold its 65.7% stake back to Dangote in 2016 for $1bn.

Olam acquired Crown Flour Mills in Nigeria for $107.6m in 2010 and Amber Foods in 2016. The DFM acquisition will double Olam’s milling capacity in Nigeria and make it the largest wheat miller in the company. Prior to the acquisition, Olam had a wheat milling capacity to 6,140 tonnes a day and was the #2 wheat miller by volume. Olam mills wheat in four West African countries: Nigeria (Lagos, Warri, Kano, Port Harcourt), Cameroon (Douala), Ghana (Tema) and Senegal (Dakar).

The company has an extensive footprint in Central and West Africa, operating in 9 countries: Burkina Faso, Cameroon, Republic of Congo, Côte d’Ivoire, Gabon, Ghana, Senegal and Togo, as well as Nigeria. Elsewhere in Africa Olam operates in Algeria, Egypt, Ethiopia, Morocco, Mozambique, South Africa, Sudan, Tanzania, Uganda, Zambia and Zimbabwe.

As part of the deal, Olam will acquire DFM’s five flour and pasta factories as well as its sea freight logistics hubs in Apapa (Lagos) and Calabar. Olam has said it intends to use DFM to increase its manufacturing capabilities and coverage in Nigeria to meet growing demand for wheat-based products. It also has identified grains and animal feeds as a core area for growth.

With the acquisition of DFM, Olam says it has an increased manufacturing footprint to reach a broader population across Nigeria, where demand is driven by increased consumption of convenient and affordable wheat-based products, such as bakery, snacks and pasta.