The Nigerian Federal Government’s plan to commence the sell-off of several state-owned assets is geared at raising funds that will go towards financing the country’s expensive 2018 budget.
Come early October 2018, the Government will commence the sale of assets in ten state-owned corporations, a move that is expected to generate some ₦289 billion; about $797 million.
The Director of Nigeria’s Bureau of Public Enterprises, Mr Joe Anichebe, disclosed this to Bloomberg over the weekend during an interview in Abeokuta. According to him, final preparations are being made to sell off the companies. Two of them – NICON Insurance Limited and Skyway Aviation Handling Co. (SAHCOL) – will be sold early October through an IPO, he said.
Back in June, President Muhammadu Buhari had appended his signature to an ambitious ₦9.1 trillion 2018 budget which it has since struggled to finance.
Meanwhile, the Government had in the past hinted at plans to fund the budget with money from other sources other than oil which is the country’s economic mainstay. To this effect, the Bureau of Public Enterprise made a commitment to the tune of ₦306 billion, most of which it is now trying to raise through the planned privatisations.
Recall that the Government last week divested about 21% of its shares in the Nigerian Security Printing and Minting Company (NSPM), a move that resulted in the realisation of the sum of ₦17.3 billion as Mr Anichebe disclosed.
The Bureau of Public Enterprises also disclosed that the agency will soon go after owners of previously-privatised public assets who have failed the terms and conditions of the deal.
In the meantime, the economy is underperforming
The poor implementation of the 2018 budget has not augured well for the Nigerian economy which recently emerged from a debilitating economic recession. To worsen this situation, a recent analysis by Nairametrics shows that the country has continued to gradually slip back into recession since Q1 2018 when the GDP declined by 1.95%.
Now as the Nigerian election season continues to approach fast, there are growing concerns that the present economic situation may become exacerbated due to huge spendings which may ultimately drive up inflation.
Uber expands food delivery business in a $2.65 billion acquisition
This deal would help Uber expand its market share against privately held DoorDash Inc.
The multinational ride-hailing service company, Uber has agreed on a deal aimed at expanding its food delivery business with the acquisition of food delivery app, Postmates Inc, in a $2.65 billion all-stock take over which is expected to be announced as soon as Monday, July 6, 2020.
According to Bloomberg, the deal which has been approved by the board of directors of Uber, will have the head of Uber’s food delivery business, Pierre-Dimitri Gore-Coty, to continue to run the combined delivery business. Under the agreement, Postmates Chief Executive Officer, Bastian Lehmann and his team will continue to manage Postmates as a separate service.
This deal would help Uber expand its market share against privately held DoorDash Inc, the current market leader in US food delivery business. While Postmates lags behind DoorDash in the race for market share, it has still been able to maintain a strong position in Los Angeles and the American Southwest, both of which could be available to Uber eats.
Uber and Postmates who have been in discussion for about 4 years, intensified the acquisition talk about a week ago, after an approach by Uber. This move is coming on the heels of the failed bid by Uber to acquire publicly quoted GrubHub Inc, which was bought over by Europe’s Just Eat Takeaway.com NV for $7.3 billion.
Postmates’ valuation was last put at $2.4 billion when it raised $225 million in a private fundraising around last September. According to analytics firm, Second Measure, they account for 8% of the US meal delivery market in May.
Postmates, which was founded in 2011 was one of the first to let customers in the U.S. order meal delivery using a mobile app. However, competition has intensified in recent years and Postmates has fallen to a distant fourth. The company said in February 2019 that it had filed paperwork confidentially for an initial public offering but never went public.
Cornerstone Insurance’s board will meet July 22nd to consider 2 important issues
Directors typically meet to consider/approve financial statements before they are released.
Cornerstone Insurance Plc’s board of directors will meet on July 22nd to deliberate on two important company issues.
A public notice that was signed by the Company Secretary and issued to the Nigerian Stock Exchange (NSE), noted that the two main talking points at this meeting are the company’s unaudited Q2 2020 financial statements, and the proposed issuance of bonus shares to the company’s existing shareholders.
As you may well know, board members of many companies listed on the NSE are all scheduled to meet later this month, ahead of the release of these companies half-year 2020 earnings reports. Directors typically meet to consider/approve financial statements before they are released.
Meanwhile, between the time a company’s board of directors meet over their financial statements and the actual release of said financial statements, there is what is called “a closed period”. During this closed period, all persons with insider knowledge of the company’s affairs are prohibited from trading in the company’s stock.
In the case of Cornerstone Insurance Plc, a closed period on its stock will start from tomorrow (July 7th, 2020) and will remain effective until 24 hours after the release of the company’s Q2 2020 financial statements. Note that no date was given for the release of the Q2 financial report.
“Accordingly, in line with the provisions of Rule 17.17: Closed Period, Rulebook of The Exchange, 2015 (Issuers’ Rule) and which has been incorporated into Sections 5 and 6 of the Company’s Securities Trading Policy, all Directors, Persons discharging managerial responsibility, Adviser(s) of the Company, or their connected persons shall not trade in the Company’s shares from Tuesday, July 7th, 2020 until 24 hours after the release of the Company’s Unaudited Financial Statements for the Second Quarter ended June 30, 2020 to the NSE and the general public,” part of the statement by the company said.
Recall that Nairametrics reported some months ago that Cornerstone Insurance Plc was in merger talks with some insurance companies ahead of the recapitalization deadline set by the National Insurance Commission (NAICOM). The company’s Group Managing Director, Ganiyu Musa, disclosed that consolidation is a more viable option towards meeting NAICOM’s recapitalisation requirement.
It is uncertain, at this point, if the company is still considering a merger as a viable option. This is because in March 2020, Nairametrics reported that Cornerstone Insurance Plc is one of the insurance firms that have resorted to selling off their real estate properties in order to raise money. The reported had quoted the MD discussing how his company “took the big decision to sell the property which we did at a very handsome price. And just in one fell swoop, it resolved many issues. We now have a significant amount of liquidity, we do not have the headache of recapitalisation and we have done what the regulator wants, which is to convert any property to cash.”
Meanwhile, NAICOM has since postponed the recapitalisation deadline to September 2021 due to the economic challenges posed by the COVID-19 pandemic.
Note that the company reported a gross premium income of N4.6 billion in Q1 2020, compared to N4.8 billion in Q1 2019. However, profit for the period stood at N475.1 million, as against a loss after tax of N98.4 million during the comparable period in 2019.
The company’s stock opened today’s trading on the Nigerian Stock Exchange with a share price of N0.50. Year to date, the stock has gained roughly about 20%.
PwC admits 8 Nigerians, 16 others as partners across Africa
PwC has about 400 partners and over 9,000 people spread across 34 countries in Africa.
PricewaterhouseCoopers (PwC) has admitted 24 professionals in Africa, including 8 Nigerians, into the firm’s partnership.
Akinyemi Akingbade, Chioma Obaro, Yinka Yusuf, Wura Olowofoyeku, Tosin Labeodan, and Rukaiya El-Rufai were all admitted into the firm’s Assurance practice, while Kunle Amida and Olusola Adewale were appointed into Advisory.
From South Africa, nine partners were also admitted; Lumko Sihiya, Mary-Jane Mberi, Nitassha Somai, Erik Booysen, Dale Stonebridge, and David Hill, into Assurance.
Kerin Wood and Gavin Johnston have admitted partners into Advisory, and Michael Butler into the Tax and Regulatory Services.
In Zambia, the partners admitted include George Chitwa, Tax, and Martin Bamukunde in Assurance.
Andre Burger was admitted Partner, Assurance in Namibia; Mwangi Karanja, Partner Assurance in Kenya; and Icho Molebatsi, Partner Assurance, in Botswana.
Two partners were admitted in Ghana, Richard Ansong in Assurance; and Kingsford Arthur in Advisory.
PricewaterhouseCoopers is a multinational professional services network of firms headquartered in London, United Kingdom, operating as partnerships in several countries under the PwC brand.
PwC has about 400 partners and over 9,000 people spread across 34 countries in Africa.