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DEAL: VFD Group may take key stake in Abbey Mortgage Bank

@vfdgroup may take a key stake in Abbey Mortgage Bank Plc, through a private placement. Shareholders of the bank gave approval at its AGM held this week.

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Abbey Mortgage Bank to raise capital, Abbey Mortgage Bank to issue shares

Abbey Mortgage Bank Plc may have a new key investor soon, going by some of the resolutions passed at its Annual General Meeting (AGM), which held on Monday. During the event, shareholders approved the following resolutions:

  • That the authorized capital of the company be increased from N3.5 billion to N6 billion by the creation of 5 billion ordinary shares which will rank pari passu with existing shares.
  • That the company be authorized to raise N2.3 billion in capital by way of private placement.
  • Subject to regulatory approval, the private placement shall be by way of sale of 2,261,538,462 ordinary shares at the rate of N1.05 to VFD Group.

If the deal clicks

Abbey Mortgage Bank currently has 4.2 billion shares outstanding. If the private placement is approved, VFD group will be one of the majority shareholders in the company.

Current key shareholders 

Figures from Abbey Mortgage Bank’s 2018 full year financial statements showed that the largest shareholders were Rose Ada Okwechime and Chief Ifeanyichukwu Boniface Ochonogor. Okwechime is the founder and Managing Director.

Okwechime has a 30% stake through her personal holdings and Madonna Ashib Comm. Enterprise Ltd. Ochonogor holds a 30.75% stake through his personal holdings and Forte Properties & Investment Ltd.

Earlier moves

In an exclusive interview with Nairametrics last year, CEO of the group, Nonso Okpala, had hinted at plans of getting into the banking space.The firm had also raised N2.7 billion through a rights issue and private placement.

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About VFD Group

VFD Group was incorporated with the Corporate Affairs Commission (CAC) on 7 July, 2009 and commenced business operations effectively on 1 January, 2011.

The company’s subsidiaries include VFD Microfinance Bank, Everdon Bureau De Change, and Anchoria Asset Management

About Abbey Mortgage Bank

The bank was incorporated in Nigeria as a private limited liability company on 26 August 1991 and obtained its license to operate as a mortgage bank on 20 January, 1992. It commenced business on 11 March, 1992 and later converted to a public limited liability company in September 2007.

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On 21 October 2008, the bank became officially listed on the Nigerian Stock Exchange. On 16 January, 2014, it changed its name from Abbey Building Society Plc to Abbey Mortgage Bank Plc.

The bank last traded on the 11th of July, 2019 at N0.90 per share. Year to date, the stock is down 8.16%.

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via [email protected]

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Corporate deals

AirSmat joins NVIDIA Inception

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AirSmat today announced it has joined NVIDIA Inception, a program designed to nurture startups revolutionizing industries with advancements in AI and data sciences.

AirSmat is focused on helping businesses harness the power of drone and satellite data.

Our approach in capturing data, ingesting data to our platform, and processing same in an intelligent way and its ability to digest large amounts of data and draw precise conclusions will help businesses gain insight into creative, beneficial strategies for the future.

We are starting out with data intelligence in farming. AirSmat is on a journey to ensure food security in Nigeria and the African continent by helping farmers and farm owners have access to useful intelligence that helps them take proactive steps to solve problems on their farms before the harvest season.

With this, we are sure of maximum yield for farmers, increased profitability, and cascading effect of food security for Nigerians and everyone on the continent. We are starting out in Nigeria, but our market is Africa.

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NVIDIA Inception will allow AirSmat the needed tailwind for AirSmat and the implication is clear – Artificial Intelligence capabilities development on a steroid.

AirSmat will not only network with fellow startups, venture capitalists, and industry leaders at exclusive Inception events but have access to industry-leading technical guidance on which GPU-accelerated platforms, tools, and hardware in addition to co-marketing support from NVIDIA marketing channel.

The program will also offer AirSmat the opportunity to collaborate with industry-leading experts and other AI-driven organizations.

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“Being part of NVIDIA accelerator program is a major milestone in our journey to build a world-class pan-Africa AI-driven business” AirSmat CTO, Adeoluwa Ibikunle reiterated.

According to the CTO, “AirSmat’s simple goal is – Using AI, we save farmers and farm owners valuable time and resources in identifying problems on their farms before these affect the yield of the planting season; being part of NVDIA accelerator program is the best thing that has happened to AirSmat as it will help us to achieve this goal with precision.”

NVIDIA Inception is a program that helps startups during critical stages of product development, prototyping, and deployment.

Every Inception member gets a custom set of ongoing benefits, such as ​NVIDIA Deep Learning Institute​ credits, marketing support, and technical assistance, that provides startups with fundamental tools to help them grow.

About AirSmat

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AirSmat was founded on the belief that Artificial Intelligence will shape the future.

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We provide cutting edge AI solutions to many rapidly growing industries adopting drones into daily operations by helping to transform the way businesses collect, manage, and interpret drone data. We help businesses unlock the power of drone and satellite data.

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Corporate deals

Multichoice acquires 20% stake in BetKing

The value of the deal is said to be worth R1.8 billion.

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Multichoice acquires 20% stake in BetKing, MultiChoice partners Walt Disney

South African pay TV operator Multichoice has announced that it acquired a 20% stake in BetKing, a gambling company with major operations in Nigeria. The value of the deal is said to be worth R1.8 billion.

The BetKing 20% acquisition was disclosed this week by Multichoice CEO, Calvo Mawela, during a news briefing to discuss MultiChoice’s new deals.

READ: CBN allows banks to pay winnings, salaries for 7 banned betting & gaming companies

READ: Africa: South African unemployment rises to 17-year high of 30.8%

What you should know 

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Nairametrics reported in 2018 that an estimated 60 million Nigerians between the ages of 18 and 40 were involved in active sports betting, with almost ₦2 billion being spent on sports betting daily in Nigeria. This translates to nearly ₦730 billion in a year.

Several sports betting companies have emerged in the country, such as Bet9ja, Nairabet, Merrybet, Naijabet, BetKing, Sporting Bet, Surebet24, and many others.

READ: Is online sports betting really profitable?

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READ: Is there trouble in paradise for the South African economy?

Nairametrics reported in July that BetKing announced a sponsorship deal with the Football Kenya Federation (FKF). This was adjudged the biggest sponsorship deal in the history of Kenyan football.

Valued at $11 million (1.2 billion Kenyan shilling), the new sponsorship deal will end in 2025. According to the FKF, each club in the Kenyan league will receive 8 million Kenyan Shillings a year ($1= 107.85 Kenyan shillings) thanks to this partnership.

MultiChoice CEO added that sport betting augments their business as sport is major revenue source for the company. He also stated that BetKing has grown fast in Nigeria and plans on expanding to South Africa.

“We have a lot of sport on our platform, and many people that are betting watch more games.” he said.

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READ: Key ‘side-hustles’ Nigerian Bankers supplement their income with

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READ: Is sports betting gradually making Nigerian youths lazy?

“They plan to be pan-African and will be entering South Africa at some stage too,”

Reuters reports that the deal would be valued at $81 million upfront, “with a further $31 million performance-dependent payment possible later.”

READ: DEAL: Nigerian Breweries and NFF sign sponsorship agreement

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Corporate deals

CAP Plc set to merge with Portland Paints and Products Plc.

CAP Plc and Portland Paints have taken a decision to merge their respective businesses in accordance with applicable laws.

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CAP Plc

The Board of Directors of Chemical and Allied Products Plc (CAP Plc), and Portland Paints and Products Plc (Portland Paints), have decided to merge their respective businesses in accordance with applicable laws to drive growth and expansion within the Nigerian and African markets.

This is according to a press release signed by Bolarin Okunowo, the Managing Director of Portland Paints, made available on NSE, Monday, 26th October 2020.

READ: Big players in Paints and Coatings industry suffer 52% profit loss in the first 6 months of 2020

The completion of the proposed merger is subject to approvals being obtained from the Federal Competition and Consumer Protection Commission, the Securities and Exchange Commission (SEC), The Nigerian Stock Exchange (NSE), the Federal High Court, as well as shareholders of CAP and Portland Paints.

READ: Meet the woman winning in a male-dominated paint market 

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What you should know

  • Should the proposed merger go ahead, CAP Plc will emerge as the resultant entity.
  • The proposed merger will be executed by way of a Scheme of Merger (the “Scheme”) in accordance with Section 711 of the Companies and Allied Matters Act, 2020, and other applicable laws, rules, and regulations.
  • The Scheme will involve the transfer of all Portland Paints Plc’s assets, liabilities and business undertakings including real property and intellectual property rights to CAP Plc.
  • In consideration for the transfer, CAP Plc is offering shareholders of Portland Paints a choice to receive N2.90 cash for every Portland Paints share held OR 1 new ordinary share of CAP Plc, credited as fully paid up for every 8 Portland Paints shares held.
  • The proposed consideration represents a 45% premium to the last traded share price of Portland Paints Plc on October 16, 2020, being the last business day prior to the date on which CAP Plc sent its merger proposal to the Board of Portland Paints and a 41% premium on the trading price as at close of trading on October 23, 2020.

READ: GNI lists shares on NASD after delisting voluntarily from NSE 

What they are saying

Commenting on the proposed merger, David Wright, Managing Director of CAP, said, “The decision to pursue the proposed merger, is driven by the Board’s strategic plan to aggressively grow within the Nigerian and African markets.

“We believe that the Proposed Merger presents a unique opportunity that will benefit all stakeholders, from shareholders to customers, as well as the broader economy. I am excited by the prospect of an enlarged company with a broader decorative paint portfolio covering the premium, mid-market and affordable segments and the inclusion of marine and protective coatings, all of which will benefit our customers and shareholders.”

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READ: Africa Prudential tops losers list following mark down

The Managing Director of Portland Paints, Bolarin Okunowo, submitted that “In recent months, the Board and Management of Portland Paints have evaluated various strategic options with a view to positioning our company to capture emerging growth opportunities.

“CAP Plc’s business is complementary to ours, and both companies will be better able to serve our respective customers by coming together. I believe the combination of Portland Paints and CAP will yield significant benefits for all of our stakeholders.”

Mutual shareholder

Portland Paints and Products Nigeria Plc – with 85.98% of the company’s issued share capital owned by UAC Nigeria Plc, manufactures and sells decorative, industrial, and marine/protective coatings for the construction of oil & gas industries in Nigeria. Portland Paints is the Nigerian representative of Hempel. It is listed on the NSE.

Chemical and Allied Products Plc (CAP) – a subsidiary of UAC Nigeria Plc – which holds 51.49% of the company’s shares, manufactures and sells premium and standard paints and coatings, and is the sole technological licensee of Akzo Nobel Coatings International B.V. in Nigeria. It is listed on the NSE.

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