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First Aluminium signs coil supply agreement

Wednesday, Dec 26, 2012

  First Aluminium Nigeria (FAN) Plc has signed an agreement with a producer of aluminium coil for the supply of unpainted coil to FAN for the production of roofing sheets.

  The company, according to the Nigerian Stock Exchange, had for a long time, been under intense pressure from both its customers and shareholders to compete more effectively with the imported coils.

  The challenge for FAN, according to the report had been to achieve this without lowering its on-going commitment to quality.

  “FAN is today happy to announce that it has signed an exclusive supply agreement with a world-class producer of aluminium coil for the supply of unpainted coil to FAN.

  “FAN will now focus on the painting and coating of these coils, using its current facility in Port-Harcourt. The painting process that has been used by FAN has always ensured that the roofing sheet stays colour-fast for many years without fading.”

  This agreement according to the company would ensure that all materials supplied to FAN will be produced to the same strict tolerances and quality specifications of existing FAN supplied coils.

  People purchasing roofing sheets with the FAN logo also in the future can do so with the full confidence that they own a product of the highest quality, with the correct gauge and with the best paint quality available in the market.

  As a consequence of this agreement, according to the report, FAN will streamline its manufacturing operations in Port Harcourt and utilise an outsourcing strategy to reduce operating cost in order to return to profitability as rapidly as possible.

  This, the company said, would initially lead to a reduction in workforce in the Port Harcourt site, but however added that this was needed to give way to future growth.

  “It is FAN’s intention to resume local rolling of aluminum sheets as soon as market conditions allow this to take place. FAN’s market share has grown rapidly the previous years. FAN believes that by reducing its cost of operations and because of the increased brand awareness by customers, it will grow even faster, surpassing suppliers of lower quality products.

  “FAN fully supports and encourages the on-going Standards Organisation of Nigeria (SON) initiatives in the stopping of the supply of under-gauged and poor quality materials for use in the production of roofing sheets. Apart from supplying aluminum sheets FAN also manufactures aluminum and plastic tubing for use in the packaging of healthcare, beauty and industrial products. The supply agreement does not affect the operations of the packaging division.”

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