This Corporate News Compilation for the week ended November, 4th 2017 is brought to you by Bluechip Technology Ltd Nigeria.
- Vik Industries Ltd announced the introduction of “Nigeria’s first ever locally-produced groundnut spread” named Nutzy peanut butter. The company claims the peanut butter is better than some of the imported brands we have in local supermarkets (don’t expect you to believe that). They also claimed the peanut butter can be used to prepare local soups, sauces and dips. Explaining why he thought the butter could do better than foreign made ones, he claimed it is because Nigerian groundnuts taste differently and are one of the best in the world. So, I looked up these guys and they have a manufacturing plant in Oshodi Isolo area of Lagos. They are more renowned for manufacturing plastic products, so it appears this is a new product division. The company’s CEO is Mr. Ajay Ramnanai. The company by the way, has been in Nigeria for over 50 years.
- Ahead of the impending competition from Kwese TV and TsTV, Star Times has launched its own Pay per day model for all its bouquet. Start Times said its customers, who are mostly lower middle class can watch as many as 30 channels with just N60 per day or N300 per week for its NOVA bouquet. Considering that it cost N900 a month for the same bouquet, the Pay per day buffs are effectively paying double he amount it cost for a one-month subscription.
- Uber seems to have upped its game with a rash of new features for its drivers. The new GM, Uber West Africa, Lola Kassim, said the introduction of new features was in response to some of the feedback they have received over the past few months. Here are examples of some of the new features. Drivers and riders can now chat within the app instead of calling on their mobile phone. This is good for those who hate to reveal their private numbers. Uber drivers can now share their trips to “their loved ones”, a security feature for drivers carrying riders into destination which they feel is unsafe. Uber drivers can also set a time when they want to go home enabling them to book rides that are on their path home, helping them to some extra bucks. Uber has about 7,000 partners in Nigeria with under 300 thounsands riders.
- MTN gave us the closest date yet to a launch of its impending IPO. Its CEO, Rob Shutter informed the media that the IPO “project” could go live in the “next six months or so”. 6 months from now is in May 2018. In a related news, farmers in the Northern part of Nigeria pleaded that MTN deactivate unregistered SIM cards in the north, which it claims is being used by Boko Hara, members to perpetuate violence and terrorism.
- Globacom reported last week that it was building about 200 base transceiver stations (BTS) at a cost of about N18 billion. This suggest the cost of the base station is about N90 million each. The NCC claims Nigeria has about 40,000 base stations and is said to require about 80,000 BTS. Investments in the telecoms industry dried up in 2017 as GSM firms suffer the effect of a recession.
- This time last year, airlines were lining up in droves to pull out of flight operations from Nigeria, following the exchange rate crisis. However, 2017 has turned out better than expected after the CBN introduced the Importer Exporter window, increasing forex inflows into the country. Emirates airline, one of those that left confirmed it (I hear it’s the Minister not them) is resuming flight operations out of Abuja after one year of suspension. And by the way, British Airways and Emirates have also rolled out decent end of year promos for travelers. Check here, if you need cheap tickets.
- South African firm, Sumitomo Rubber, South Africa has teamed up with Tyre Express Nigeria Ltd to introduce a Dunlop Store in VI, Nigeria. The South African firm sells Dunlop, Falken and Sumitomo tyres brands in about 48 African countries. Sumitomo is a Japanese company with presence in about 9 African countries. They are, Kenya, South Africa, Morocco, Ghana, Madagascar, Mozambique, Angola and Tanzania. Strangely, they don’t have a base in Nigeria.
- There was more capital raising news last week, following the announcement by Flour Mills that it was embarking on a rights issue. The company plans to raise N70 billion which it plans to repay its loans. Lafarge earlier announced it wanted to raise N132 billion. We will be watching these two offers closely as I do not know if this market is deep enough for over N200 billion in a space of 6 weeks. About N127 billion was raised in the first half of this year via rights issue. The highest we have ever raised in a rights issue in any year was N200b and that was in 2014.
- On the housing front, Lagos State Government announced that it has signed an MOU with the Nigerian Mortgage Refinance Company to deliver about 20,000 housing units. If there is one thing the NMRC is very good at, it is signing MOUs. It was setup to help inject liquidity in the housing sector, however, housing for all still remain a utopian desire.
- In related news, Grenadines Homes, who we reported a few weeks back was developing of the N40 billion Atlantic Resort, revealed that it is introducing a concept hotel that will provide high returns on investment for investors. The Oceanna hotel room, as they call it, basically allows investors to have a stake in a hotel room and will earn a good portion of the rate paid by guests. This is not exactly a new concept around the world, but its fairly new in Nigeria. Some investors have tried unsuccessfully to introduce it. Grenadines claimed it will give investors about 14% returns per annum as against 6% for buy to let investments. Buy to let investments, which is another name for rental properties, yield about 6%, according to their data. They also claim it will take about 17 years to recover your money.
- Still on real estate, Transcorp announced last week that it had signed a 20-year extension of its management contract with Hilton.
- The newly established Development Bank of Nigeria has commenced lending activities. Last week, it reported that it lent out about N5 billion to three microfinance banks. They are, Fortis Microfinance Bank Plc, LAPO Microfinance Bank Limited and NPF Microfinance Bank Plc. The banks will be expected to lend the money to about 20,000 entrepreneurs.
- In our “one chance” story of the week, a Ford model, Nneoma Anosike has taken Wema Bank to court for using her face in an ad. According to her lawyers, Wema Bank used her for an advert with the bank’s corporate logo beside her face and the words, “Be yourself, everyone else is taken”. Her lawyer also claims, this projection of Nneoma by the bank was with the aim of projecting the bank’s value and goodwill using her fame and popularity. They have sued Wema Bank, N20 million.
- By the way, Access Bank said it has signed a deal with Chinese car maker GAC Motors to offer potential vehicle buyers loans to buy the car. They claim all you need is to provide 10% equity and with a “brought down” interest rate of 24%.
- Diamond Bank has confirmed plans to spin off some of its assets outside Nigeria, part of its restructuring plans. First on the list is Diamond Bank SA, where it plans to divest 97.7% of its holdings. It plans to sell it for 61 million Euros. Their 2016 annual report shows they valued the investment at N5.8 billion. Their other subsidiary, Diamond UK is valued at N7.9 billion.
- A newspaper reported last week that a US company was planning to acquire a Nigerian Bank. According to the report, United States-based private equity firm, Milost Global Inc, is currently conducting due diligence on one of Nigerian banks in preparation for possible acquisition. They did not reveal the name of the bank but only stated that they have about 250 branches. We don’t know for sure but what bank this is, but it might be Unity Bank. Unity Bank has about 240 branches and we understand that they are looking to raise capital.
- Some of us were shocked to hear last week that Rosatam, a Russian state-owned company has signed an agreement with Nigeria to construct and operate a nuclear power plant and research center in Nigeria.
- Looks like the NNPC is about to compete with the CBN/BOI on the establishment of a bio-fuel plant. A few months ago, the CBN/BOI reported that it wanted to setup one in Kogi State, and is expected to cost about $300k. NNPC took their own rhetoric a step further, by announcing that it was setting up a 65 million litres bio-fuel plant in Okeluse, Ondo State. They claimed it will create a whopping 1 million jobs in Ondo State. The CBN/BOI plant was expected to have a capacity of 100k litres per day.
- Finally, Total Nigeria has inaugurated its second lube production plant in Nigeria. The plant is in Koko, Delta State. The first is in Kirikiri Lagos.
NB Plc to raise additional N20 billion from its N100 billion Commercial Paper
Nigerian Breweries has announced the continuation of its N100 billion Commercial Paper (CP) Issuance Programme.
Nigerian Breweries has announced the continuation of its N100 billion Commercial Paper (CP) Issuance Programme in a bid to raise up to N20 billion to support its short term funding needs. The company has launched Series 9 and 10 of the programme for this purpose.
This information was disclosed in a notification signed by the Company’s Secretary, Uaboi G. Agbebaku, and sent to the Nigerian Stock Exchange.
The notification reads;
“[Nigerian Breweries Plc] is pleased to inform the Nigerian Stock Exchange and the investing public of the continuation of its “CP” (Commercial Paper) programme with the launch of Series 9 and 10 of the programme.
“Series 9 of the Commercial Paper programme would be for a tenor of 180 days, while Series 10 would be for 270 days. However, the launch of the CP opens today 23rd October 2020.”
What you should know
According to data obtained from Financial Market Dealers Quote (FMDQ), Nigerian Breweries has raised up to N90.12 billion since the start of the year.
- N52.76 billion was raised from Series 6 between February 12 to November 6, 2020.
- N13.03 billion was raised from Series 7 from April 15 to October 14, 2020.
- N24.33 billion was raised from Series 8 from April 15 to January 8, 2021.
- The recent issuance of the Series 9 and 10 CP will bring the total funds raised to N110.12 billion.
Why it matters
- The CP will help the company navigate through the recent impact of COVID-19 and other trade disruptions.
- The programme will strengthen the balance sheet of the company, and enable the brewer to execute its plans while delivering value to customers and creating wealth for shareholders,
- In like manner, the CP programme is expected to provide opportunities for non-equity investors to invest in the company and support its cost management initiatives.
MTN shareholders have made approximately N1 trillion since April 2020
Shareholders of MTN Nigeria gained close to a trillion naira in less than 7 months.
MTN Nigeria shareholders have gained N986.58 billion since the first trading session in April 2020.
This was uncovered by calculating the difference in the telecommunication giant’s market capitalization of ₦1.832 trillion at the open of trade, for the first trading session in the month of April 2020, and the market capitalization of ₦2.646 trillion at the close of trade in the first trading session in the month of October.
This gives a whopping N814 billion increase in market capitalization, and this with the dividend the company has paid to shareholders on two occasions between this time period, brings the total gains both realized and unrealized to approximately N1 trillion.
Hence, the N814 billion increase in market capitalization translates to the joint gains MTN investors have made from the increase in the shares of the company, as the share price of the company has increased by 44.44% or ₦40.00 between April 1, 2020, and October 2, 2020, with the share price of increasing from ₦90.00 to ₦130.00.
However, the gains MTN NG investors have made from their investments in the telecommunication company, is not limited to the gains driven by the increase in the price of the shares.
Recall that the company declared payment of dividends to its shareholders on two occasions, as investors/shareholders of the company, whose names appear in the Register of Members, as of the close of business on April 17, 2020 and August 14, 2020 were paid a cumulative dividend per share of ₦8.47, for all the outstanding shares of 20,354,513,050 held by the shareholders, and this translates to a total dividend payout of N171 billion by the company to its shareholders.
It is noteworthy that the realized and unrealized gains MTN investors have made from holding the shares over this period stands at N986.58 billion.
LASACO Assurance Plc Chairman, Aderinola Disu resigns from the Board of Directors
Aderinola Disu resigned her position as a Director on the Board of LASACO Assurance.
Lasaco Assurance Plc has announced the resignation of its former Chairman, Mrs. Aderinola Disu, as a Director on the Board. The resignation took effect from the 8th of September, 2020.
The following information is contained in a press release made available to the public, signed by the company Secretary, Gertrude Olutekunbi, and verified by Nairametrics.
The notification also revealed that, the aforementioned firm has received a provisional approval from the National Insurance Commission (NAICOM) to appoint two other directors.
The two newly appointed directors are; Dr (Mrs.) Maria Olateju Phillips, and Prince Jamiu Adio Saka, both appointed to a Non-Executive Director role.
Profile of the two newly appointed Directors
Chief (Mrs.) Teju Phillips, is a successful Chartered Accountant, who holds an ACCA from England and Wales. She is multilingual and has extensive experience in Management/Consultancy services, that spans across many years in both the public and private sectors. She has served as a Director in Keystone Bank; Director, Lagos State Lottery Board; Honorable Commissioner for Special Duties & Inter-Governmental Relations in Lagos State; Managing Director of Alma Beach Estate Ltd (a subsidiary of Rims Merchant Bank Ltd); Managing Director, Maridot Ventures Ltd. among others.
Prince Jamiu Adio Saka, is an accomplished Insurance professional, having practiced in Canada and Nigeria. He brings to the board over 30 years of experience as a Broker.
Lasaco Assurance Plc, is a listed Nigerian firm that provides life and general insurance services, which includes motor, bond, contractors-all-risk, fire, burglary, aviation, marine, general accident, life, pension schemes, engineering, and oil and gas. The company has a market capitalization of about N2.05 billion and it share price currently trades at N0.28 kobo.