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AXA Mansard insurance divests from AXA Mansard pension as new owner emerges

This disclosure was made in a notification that was sent to the Nigerian Stock Exchange.

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AXA Mansard Insurance Plc

AXA Mansard Insurance Plc has announced its divestment from its subsidiary, AXA Mansard Pension Limited, after agreeing to sell its stake to Eustacia Limited, a member of the Verod Group.

This is part of the insurance firm’s plan to focus on and grow its insurance businesses across all parts of the country.

This disclosure was made in a notification that was sent to the Nigerian Stock Exchange (NSE) on August 8, 2020, by AXA Mansard Insurance Plc and signed by its Company Secretary, Mrs Omowunmi Mabel Adewusi.

AXA Mansard Insurance disclosed that Eustacia Limited was selected as the preferred bidder, after the completion of a bid process. AXA Mansard along with the minority shareholder agreed to sell the entire issued ordinary share capital of AXA Mansard Pensions comprising of 60% shareholding (2,067,672,000 shares) held by AXA Mansard Insurance Plc and 40% shareholding (1,378,448,000 shares) held by the minority shareholder.

READ MORE: Corporate Actions: Half a billion ‘frozen’, retirements and a New ED

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The statement from AXA Mansard Insurance reads, ‘’AXA Mansard Insurance Plc announces the divestment from its subsidiary, AXA Mansard Pensions Limited. After obtaining the Shareholder’s approval at the Company’s Extra-Ordinary General Meeting held on the 13th of February 2020, the Company commenced the process of divestment by appointing Messer Rand Merchant Bank as the Financial Advisers while Aluko & Oyebode acted as the Legal Advisers on the transaction.’’

‘’Upon completion of a bid process, Eustacia Limited (a member of the Verod Group) was selected as the preferred bidder. The Company along with the minority Shareholder entered into a sale and purchase agreement with Eustacia Limited to divest the entire issued ordinary share capital of AXA Mansard Pensions comprising of 60% shareholding (2,067,672,000 shares) held by AXA Mansard Insurance Plc and 40% shareholding (1,378,448,000 shares) held by the minority shareholder.’’

The insurance firm, also in its statement said that the divestment has received letters of no objection from the National Insurance Commission (NAICOM), National Pension Commission (PENCOM) and the Federal Competition & Consumer Protection Commission (FCCPC).

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READ ALSO: Forte Oil Plc hits fresh year to date low on the NSE

It should be noted that the completion of the divestment is, however, subject to the receipt of the final approval of the National Pension Commission.

In his reaction, the CEO of AXA Mansard Insurance Plc, Kunle Ahmed, said that this transaction marks a new step in the insurance firm’s broader strategy to focus on and grow their life, property & casualty and health businesses across all its geographies. He said that the AXA Group sees great potential in the Nigerian insurance market and believes they are ideally placed to capture these opportunities due to its market leadership position.

On his part, the CEO of AXA Mansard Pension Limited said that they are confident about Verod’s strong commitment to providing the company with the requisite support to actualize their promise to its clients and stakeholders.

A partner at Verod Group, the new owners, Eric Idiahi, said, ‘’We strongly believe that this is the ideal time to enter the market and that AXA Mansard Pensions provides an excellent beachhead from which to establish a consolidated position and gain market share.’’

Nairametrics reported early this year that AXA Mansard Insurance Plc announced that its shareholders have approved the company’s plan to sell its pension management subsidiary, AXA Mansard Pensions Ltd and some undisclosed real estate investments.

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Chike Olisah is a graduate of accountancy with over 15 years working experience in the financial service sector. He has worked in research and marketing departments of three top commercial banks. Chike is a senior member of the Nairametrics Editorial Team. You may contact him via his email- [email protected]

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Companies

Dangote Cement to extend clinker export to other African countries 

Dangote is on course to sell more clinker across West Africa and commence shipment to Central Africa in H2 2020. 

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Dangote Cement Plc. appoints Ms. Berlina Moroole as non-Executive Director

The Management of Africa’s largest cement producer, Dangote Cement Plc (DCP), disclosed during a virtual event yesterday, that the cement producer is set to commence clinker export to other African countries within the next few weeks. 

The Acting Group CFO, Guillaume Moyen, made this known in his presentation at the joint virtual event with NSE, tagged “Facts Behind the Figures and Sustainability report’’ on Wednesday24th September, 2020. 

Backstory: In its half-year report, the Management of Dangote disclosed that on 12 June 2020, the maiden shipment of 27.8Kt of clinker from Nigeria to Senegal left the Apapa Export Terminal. 

READ: Dangote Cement’s N100 billion CP admitted on FMDQ Securities Exchange

The Management reiterated that the company is on course to sell more clinker across West Africa, and commence shipment to Central Africa in H2 2020. As it is in line with the Group’s vision of making West and Central Africa, cement and clinker independent, with Nigeria the main export hub. 

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The absence of limestone in much of West Africa, especially those in the coastal states, forces those countries to import bulk cement and clinker from Asia and Europe, and this is quite expensive. 

READ: BUA Cement Plc posts impressive unaudited H1, 2020 financial results

However, Dangote Cement plans an exporttoimport strategypositioning Nigeria as the main export hub of the continent, in a bid to serve West and Central Africa countries from Nigerian factories, making the region cement and clinker independent. 

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This is consistent with the Group’s vision of cementing Africa’s economic independence, as this would lead to lower clinker cost for pan-African operations, due to the proximity of Nigeria to these countries, as clinker landing cost will be cheaper. 

READ: Nigerian billionaires lose billions amid COVID-19 pandemic

The Management emphasized that this is possible, as Nigeria can serve a potential market of 15 countries, with over 350 million people, given the county’s relative abundance of quality limestone, especially in key Southern regions. 

It is important to note that DCP’s clinker volume, according to figures contained in its H1 2020 results, has increased to 60Kt from 12kt in H1 2019, which translates to 400% increase. 

The benefits of DCP’s export strategy 

It is noteworthy that the innovative strategy of Dangote Cement Plc is expected to; 

  • Cement Africa’s economic independence, and contribute to the improvement of continental, regional, and intra-regional trade, as the company seeks to make regional and continental free trade agreement a reality. 
  • Ensure that the increase in production due to exports, leads to increase in capacity utilization in the Nigerian operation, and in turn, reduces fixed cost per tonnes 
  • Increase foreign revenue exchange for the Nigerian operation, and offset foreign exchange risks. 
  • Reduce clinker landing cost, by leveraging on the proximity of Nigeria to other African countries. 

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Companies

Fidelity Bank to raise N50 billion in bonds in Q4 to refinance existing debts

The new issue will be made to redeem the existing N30 billion bond which was issued at 16.48%.

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Fidelity Bank Plc ,CEO Nnamdi Okonkwo, Fidelity Bank Plc growth plan, SMEs funding

One of Nigeria’s second-tier commercial banks, Fidelity Bank Plc, has concluded plans to issue up to N50 billion ($131.3 million) in local bonds by the fourth quarter of 2020, in order to refinance existing debts as the yields drop.

The disclosure was made by the Chief Operations and Information Officer, Gbolahan Joshua, during an analyst call on Tuesday, September 8, 2020.

The crash of crude oil price globally, which was triggered by the novel coronavirus pandemic, has led to a decline in bond yields on the local debt market. This has made foreign investors to dump their local assets, leaving excess liquidity in the money market. This has also put a lot of pressure on the foreign exchange market as they look for dollars to repatriate their funds.

READ: Guinness Nigeria finding it hard to refinance its loans due to dollar scarcity

The Fidelity Bank top executive disclosed that the new issue will be made to redeem the existing N30 billion bond which was issued at 16.48%.

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The global economic situation has seen yields in the debt market drop from as high as 18% about 3 years ago to less than 5% for the one-year treasury bill.

READ: GTBank, Zenith Bank, UBA record losses, investors down by N12.2 billion

Fidelity Bank had revealed that it expected to see a 15% drop in profit this year when compared to 2019 result due to the coronavirus pandemic. Its profit after tax increased by 21.9% to N12 billion for the half-year 2020.

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The second-tier bank also disclosed that its income declined in the second quarter due to a downward review of lending rates on loans as a result of the economic downturn.

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Companies

Heineken buys more units of Nigerian Breweries Plc

The Dutch firm has invested N276 million in NB since August, to increase its stake in the Brewer by 0.10%.

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Heineken scoops more Nigerian Breweries shares in insider disclosure

The major shareholder of the largest brewer in Nigeria, Heineken Brouwerijen B.V, has increased its stake in Nigerian Breweries, with the purchase of 233,110 additional units of Nigerian Breweries shares. This was disclosed by the company in a notification sent to the Nigerian Stock Exchange, which was seen by Nairametrics.

According to the notification, which was signed by the Company’s Secretary, Uaboi G. Agbebaku, the purchase was made on the bourse over two transactions on the 2nd and 3rd of September.

This disclosure is a regulatory requirement that must be reported to the Nigerian Stock Exchange, especially when a major shareholder or director of a publicly quoted company purchases shares in the company they own.

READ: GTBank revenue for H1, 2020 rises to N225.14 billion

The analysis of these transactions indicates that the purchase consideration for the 233,110 additional units of Nigeria Breweries shares at an average price of N39.94 is put at N9.3 million.

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This purchase and previous purchases further cement Heineken Brouwerijen B.V’s status as a major shareholder; the company has accumulated a total of 7,720,236 since 30th June.

READ: Vitafoam’s 2020 oncourse to make light–work of 2019

As of June 30th, when Nigerian Breweries released its Half-year financial results and reviewed its shareholding pattern, the company had exactly 7,996,902,051 outstanding shares, with Heineken Brouwerijen B.V being the majority shareholder with 3,019,363,804 units, which amount to 37.76% of the total shares of the company outstanding. 

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Hence, with the current purchase of 233,110 additional units, and previous purchases in August and September 1, which amount to 7,487,126 units, Heineken’s ownership percentage of Nigeria Breweries is now put at 37.85%.

Insider transactions, both sales and purchases, are often an indication of how shareholders perceive a company’s valuation. It could also mean a possible capital raise or that the majority shareholders are strengthening their existing holdings.

READ: Heineken scoops more Nigerian Breweries shares in insider disclosure

In like manners, the purchase of the shares of Nigerian Breweries by Heineken and other majority shareholder has mopped up stray volumes on the bourse, and pushed the stock price higher by 29% or N9, from N31 it closed at on the 3rd of August to its current value of N40 with 38.2x earnings.

About the company

Nigerian breweries is the largest brewing company in Nigeria. It engages in the brewing and marketing of lager beer, stout and non-alcoholic malt drinks, and the bottling of the Schweppes range of soft drinks and Crush Orange. Its brands include Star, Gulder, Legend, Heineken, Maltina, Amstel Malta, Fayrouz, Climax, Goldberg, Malta Gold, and Life. These products are mainly sold in Nigeria and other neighbouring countries.

READ: Flour Mills and its diverse challenges

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Key takes on NB’s financials

Nigerian Breweries was affected by the disruption in the global and domestic demand and supply chain, as profit after tax of the largest brewer dropped by as much as 58%, at the back of the adverse impact of the sharp contraction in economic activities.

The knock-on effect of the COVID-19 lockdown, which affected the trade segment of the business, affected the company sales and this triggered the 11% drop in revenue in the first half of the year.

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