Trading of the shares of Continental Reinsurance Plc has been suspended effective Thursday, 28 November 2019.
The development was announced by the Nigerian Stock exchange (NSE) through a statement issued on its website.
Why this matters: The suspension is to prevent further trading of the shares of the company beyond the effective date when the Certified True Copy (CTC) of the Court Sanction would be registered with the Corporate Affairs Commission of the Scheme of Arrangement, allowing CRe African Investments Limited (CRe Investments) acquire all the shares of Continental Reinsurance (CRe Nigeria).
What happened before now: The company’s shareholders met on December 20th, 2018 to deliberate on the takeover bid by the company’s core investors. The court-ordered meeting ended with shareholders approving the proposed takeover. Subsequently, “an application was submitted to the Securities and Exchange Commission for final approval for the scheme.”
The proposed scheme of arrangement was to allow the company’s core investor (CRe African Investments Limited) to buy out minority shareholdings.
However, further on into the acquisition, the company’s core investor chose to revise its proposal to acquire all outstanding and issued shares of Continental Reinsurance for a consideration of cash and shares.
A plan to restructure: According to Managing Director (MD) of Continental Reinsurance Plc (CRe), Dr Olufemi Oyetunji, the proposal to acquire minority shareholdings was in tandem with the company’s plans to transfer the various subsidiaries of the group to CRe Investments to enable CRe Nigeria shore up its balance sheets and capital required for maintaining and expanding the business.
Oyetunji noted that under the restructuring, Continental Reinsurance Nigeria’s shares would be transferred to Continental Reinsurance African Investments in exchange for shares in CRe Investments.
As consideration for the transfer of the shareholders’ shares in CRe Nigeria to CRe Investments under the new scheme, Oyetunji said shareholders have the option to receive one ordinary share of $1 each in the capital of CRe Investments for 176 ordinary share of 50 kobo each in the capital of CRe Nigeria as at the effective date.
The second option, Oyetunji said is for them to receive N2.04 per ordinary share of 50 kobo each held by the shareholders as at the effective date.
Oyetunji added that 92.66% of shareholders voted in favour of the restructuring, while 7.34% voted against it.
However, the scheme consideration was revised upward from N2.04 to N2.10 per share, with the new price representing 51.08% premium on the share price of Continental Reinsurance as at the close of trading on October 5, 2018; the last business day prior to the date on which the proposal was received from CRe African Investments Limited.
About CRe Investments: C-Re Holding, the majority shareholder is 49% owned by Capital Alliance Private Equity IV Limited, a private equity fund sponsored by African Capital Alliance (ACA). The remaining stake is held by Saham Finances SA (the insurance arm of Saham Group).
About CRe Nigeria: Continental Reinsurance (the company) was established in 1985 and listed on the Nigerian Stock Exchange (NSE) in 2007. It has operations in 44 African countries, with its main offices in Nigeria, Kenya, Cameroon, Côte d’Ivoire, Tunisia, and Gaborone.
CBN announces new policy measures, reduces interest rates for financial institutions
CBN will be reducing interest rates on its facilities through participating financial institutions from 9% to 5% per annum for a year.
As part of its monetary and financial policy measures to further mitigate the impact of the coronavirus pandemic on households, and businesses, the Central Bank of Nigeria (CBN), has approved regulatory forbearance for the restructuring of credit facilities in the Other Financial Institution (OFI) sub-sector.
This was disclosed in a circular signed by the CBN’s Director for Financial Policy and Regulatory Department, Kevin Amugo, on Wednesday, May 27, 2020.
In the circular, stated that Amugo the apex bank will be reducing interest rates on its facilities through participating financial institutions from 9% to 5% per annum for a year with effect from March 1, 2020.
According to the circular, CBN has approved regulatory forbearance for the restructuring of credit facilities in the OFI sub-sector as follows:
‘’CBN Intervention facilities availed through participating OFIs are granted a further one-year moratorium on all principal repayments, effective March 1, 2020.
‘’Interest rates on the CBN intervention facilities through participating OFIs hereby reduced from 9% to 5% per annum for 1-year effective March 1, 2020.
‘’OFIs are granted leave to consider temporary and time-limited restructuring of the tenor and loan terms for households and businesses affected by COVID-19, subject to the recently issued guidelines for restructuring affected credit facilities in the OFIs sub-sector.”
This new policy measure by the apex bank is in continuation of its intervention in the nation’s economy so as to help manage the crisis caused by the coronavirus pandemic and reduce its effects on household and businesses.
This is coming a day before the Monetary Policy Committee (MPC) meeting for the month of May which has been slated for tomorrow Thursday, May 27, 2020.
Meanwhile, the CBN said that it shall continue to monitor developments and implement appropriate measures to safeguard financial stability and support stakeholders impacted by the COVID-19 pandemic.
President Buhari directs Ministries of Power, Finance, BPE to seal Siemens deal
Presidency has approved the release of funding for the first part of Phase 1 of the PPI, to kick-off the pre-engineering and concession financing workstreams.
President Muhammadu Buhari has directed the Ministries of Power, Finance, and the Bureau of Public Enterprise (BPE) to conclude the nation’s engagement with Siemens AG over regular power supply.
The directive, which was issued via the Presidency’s Twitter handle on Wednesday, was to start the pre-engineering & concessionary financing aspects of the Presidential Power Initiative (PPI).
PPI is a power infrastructure upgrade and modernization Programme agreed to by the Federal Government and Siemens AG of Germany, with the support of the German Government. The ultimate goal of the initiative, according to the government, is to modernize and increase the Nigerian electricity grid capacity from its current capacity of about 5 GW to 25 GW, over three phases.
How it works: Under the PPI, Nigeria on behalf of the other shareholders in the Electricity Distribution Companies (DisCos), will invest in infrastructure upgrades in the form of improved payment systems, distribution substations, transformers, protection devices, smart meters, and transmission lines among others.
The President explained that all DisCos have, directly and through the BPE, been diligently carried along over the last 15 months to understand in detail the challenges in the electricity systems.
Funding: The funding for the PPI will be secured under concessionary terms (up to 3-year moratorium and 12-year repayment at concessionary interest rates) through the German Euler Hermes cover, which Nigeria will on-lend as a convertible loan to the other shareholders in the DisCos.
According to the statement, President Buhari has approved the release of funding for the first part of Phase 1 of the PPI, to kick-off the pre-engineering and concession financing workstreams.
The ultimate goal of the #NigeriaPPI is to modernize and increase the Nigerian electricity grid capacity from about 5 GW currently to 25 GW, over three phases.
— Presidency Nigeria (@NGRPresident) May 27, 2020
“To ensure fairness and transparency of the intervention, the President has also directed that the nation engage the International Finance Corporation (‘IFC’) to assist in developing the commercial structure of the intervention…
“The President has also directed that to ensure value for money and preserve the integrity & transparency of the procurement process under the Govt-to-Govt framework, Siemens AG shall be solely responsible for nominating its EPC partners to perform all onshore works; NO middlemen.
“Our goal is simply to deliver electricity to Nigerian businesses and homes… Our intention is to ensure that our cooperation is structured under a Govt-to-Govt framework. No middlemen will be involved, so that we can achieve value for money for Nigerians,” President Buhari added.
The PPI journey started on August 31, 2018, when Chancellor Angela Merkel visited Nigeria and met with President Buhari. Then the Chancellor brought along with her a business delegation that included the Global CEO of Siemens.
Nigeria and Germany agreed to explore cooperation in a number of areas, including Power.
“Our goal is simply to deliver electricity to Nigerian businesses and homes… Our intention is to ensure that our cooperation is structured under a Govt-to-Govt framework. No middlemen will be involved, so that we can achieve value for money for Nigerians.” — President @MBuhari
— Presidency Nigeria (@NGRPresident) May 27, 2020
PPI was designed to deliver improved power supply nationwide, with attendant results in job creation, investor confidence, cost and ease of doing business and economic growth. The partnership is also expected to guarantee training & capacity building for thousands of young Nigerians (non-graduates, students & graduates).
Other goals include the creation of economic opportunities for Nigerian engineering companies that will serve as local vendors for the provision of manpower and equipment. Overall, the partnership will guarantee inflow of additional investment into the power sector.
Endeavour honours founders of Kobo360
Fixing Africa’s supply chain is clearly important for commerce on the continent.
Endeavour, a leading global movement for high-impact entrepreneurship, has honoured the founders of Kobo360, Obi Ozor and Ife Oyedele as Endeavor Entrepreneurs.
Kobo360 is a digital logistics platform that uses big data and agile technology to reduce friction and improve efficiency in the African logistics ecosystem.
Managing Director, Endeavor in Nigeria, Gihan-Mbelu, explained that the company is excited to welcome Kobo360 into Endeavor’s network which includes some of the world’s most exciting scale-up entrepreneurs and most experienced mentors and investors.
He said, “Fixing Africa’s supply chain is clearly important for commerce on the continent, and Kobo360’s rapid growth over the past 3 years is evidence that the company’s valuable services are in critical demand. Obi and Ife are inspiring founders and their relentless focus on scaling Kobo360 serves as an inspiration to high-impact entrepreneurs everywhere.”
Meanwhile, since launching in 2017, Kobo360 has surpassed several milestones, including a $30 million Series A in August 2019.
“It’s an honour to be joining this global network of high-impact entrepreneurs and to have Endeavor recognise our efforts to transform Africa’s logistics sector using technology. As entrepreneurs, we wanted to turn African problems into African opportunities.
“Focusing on logistics, Ife and I started Kobo360 to not only fix the inefficiencies that exist, but to build opportunities for the businesses we serve and most importantly, the hundreds of thousands of truck drivers across Africa. This is a fundamental milestone in Kobo360’s journey; our Global Logistics Operating System [GLOS] will revolutionize supply chain across emerging markets, Ozor, Co-founder & CEO of Kobo360.