South African Hospitality giant, Sun International, will sell off its stake in Tourist Company of Nigeria Plc once investigations by the Securities and Exchange Commission (SEC) are completed.
“Deloitte is expected to complete its investigation of the shareholder dispute shortly. Once the Deloitte investigation has been completed, it will pave the way for Sun International to exit its investment in Nigeria.”
A troubled decade
The investment has been a troubled one for the firm since it took a majority stake in 2006.
First, there were squabbles within the Ibru clan each holding a significant stake in the company. Maiden Ibru, the wife of the late Alex Ibru, had alleged that the company borrowed various sums: $7.1 million, N610 million, N381 million, and N19 million, between 2003 and 2004 which had not been paid back. She thus sought a court order for the winding up of the firm.
Maiden currently owns an 18.06% stake in the firm through Oma Investments Limited. Goodie M. Ibru holds an 18.68% stake in the firm through Associated Ventures International Limited. Ikeja Hotels Limited (which was also the subject of a tussle by the Ibru family) holds a 12.18% stake.
Investigations by the Economic and Financial Crimes Commission (EFCC) resulted in the brief detention of some Sun International staff and the withdrawal of a planned $450 million investment.
The company has thus lagged behind newer competitors on the island.
Revenue-wise, Nigerian operations are less than 1% of Sun International’s revenues as at the financial year ended December 2017.
The Tourist Company of Nigeria Plc was incorporated on 10 April 1964. The Company converted from a private company to its current form on 20 April 1994. The company owns the popular Federal Palace Hotel.
TCN closed at N3.20 in today’s trading session on the Nigerian Stock Exchange (NSE).
Results for the half year ended June 2018 show revenue dropped from N716 million in 2017 to N661 million in 2018. Loss before tax stood at N661 million in 2018 as against a loss of N790 million in the previous year.
