By Eromosele Abiodun
The Ogun State Government has endorsed the proposal by Vitafoam Nigeria Plc to partner the state on industrialisation. The state government has also given its nod to the request by Vitafoam Board and management to patronise its diversified products.
Addressing the Vitafoam’s team, during a courtesy visit to his office, the Ogun State Governor, Senator Ibikunle Amosu commended the company for the foresight and unalloyed goal of adding value to the society through introduction of innovative products.
Amosu expressed delight that Vitafoam would soon commence work on its multi billion Naira factory to be established on a large expanse of land along Lagos Ibadan Express Way.
He noted that the state government was desirous to partner the private sector operators for enhanced industrialisation as a way of reducing unemployment.
According to him Ogun State government would continue to create an investor -friendly environment where business could be done with ease.
Earlier in his speech, Vitafoam’s chairman, Dr. Bamidele Makanjuola expressed gratitude to the state government for its provision of land for Vitafoam at a substantial discount.
Makanjuola, who said the company was ready to take possession of the land, noted that the company had also diversified into building construction with its production of heavy insulation for houses.
Corroborating him, Vitafoam’s Group Managing Director, Mr. Taiwo Adeniyi stated that as part of Vitafoam’s strategic plan, the company had six subsidiaries whereby each produces distinct products with that serve as synergy for one another.
At the company’s recent annual general meeting in Lagos, Makanjuola assured the shareholders that the manufacturing firm had almost concluded arrangements to commence production of oil filters and allied motor spare parts through its newly established subsidiary,
He explained that the on-going inclement operating environment had forced the company’s board and management to embark on cost saving initiative in order to sustain the company’s competitive edge.
Makanjuola, who reviewed the current challenges facing manufacturing firms in Nigeria, noted that Vitafoam was able to remain, profitable due to the prudent approach towards management of human and material resources.
“The foam business is operating in a very competitive environment. There are over 300 manufacturers. It is stressful to operate in the foam industry. As professionals, we have tried to keep administrative and financial cost under control. This prudent approach enabled us to generate profits and declared dividend of 25 kobo per share in an environment where many companies are closing business. We were able to achieve this feat despite the high cost of operation because of our careful management practice.
“As we try to control our cost, we have decided to limit our exposure to our subsidiaries to a maximum of 40 per cent. This is expected to relieve us of financial burden of 100 per cent ownership. We can always raise 60 per cent equity through private placement. We have almost concluded plan to commence production of oil filter in our new subsidiary. As for Vono Products, we shall keep the brand. We have gone to the Corporate Affairs Commission (CAC) to ensure that the brand is not taken away, “ Makanjuola said.