As expected Oando Plc has announced plans to seek shareholders’ approval next month to raise up to N80 billion naira ($402 million) through a rights issue. The company also plans to spin off its power and gas subsidiaries.
Oando, will also seek approval on Dec. 7, to issue new shares in lieu of convertible debt owed to two shareholders Ocean and Oil Partners and OPR Ltd. The company is thought to have about N68 billion in convertible loans.
Oando is also reported to have a shareholder who owns over 70% of the company and was the same shareholder who essentially bought nearly all the rights issue offered late last year. It is believed that this same shareholder may have been approached to inject an equity lifeline badly needed to provide liquidity to the company.
Oando shares lost over 33% of its value when it announced its results only to staged a remarkable comeback two weeks later ended that week as the top gainer.