Nestlé S.A, Switzerland, the parent company of Nestlé Nigeria Plc, has increased its stake in the Nigerian subsidiary with the purchase of 229,697 additional units in the shares of the company.
This was disclosed by the company in a notification sent to the Nigerian Stock Exchange, which was seen by Nairametrics.
The purchase according to the notification signed by the Company’s Secretary, Bode Ayeku, was made on the bourse in a single transaction on 11th, 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 or sells shares in the company they own.
The breakdown of the transaction, shows that the purchase consideration for the 229,697 additional units of Nestlé Nigeria shares at an average price of N1,249.65 per unit is put at N287 million.
This purchase and previous purchases strengthen Nestlé S. A’s status as the parent company of the subsidiary. So far, the company has accumulated a total of 977,744 additional shares worth N1.165 billion since 20th August.
As of June 30th, in line with the shareholding analysis of Nestlé Nigeria in its half-year financial results, the company had exactly 792,656,252 shares outstanding, with Nestlé S.A being the majority shareholder with 524,559,457 units, which amount to 66.18% of the total shares of the company outstanding.
Hence, with the purchase of 229,697 additional units, and previous purchases from 20th August till date, which amount to 977,744 units. Nestlé S. A’s ownership percentage of Nestlé Nigeria is now put at 66.30%.
What it means: Insider transactions, both sales and purchases, are often a sign of how shareholders perceive a company’s valuation. It could also mean a possible capital raise or that the major shareholders are strengthening their existing holdings.
The purchase of the shares of Nestlé Nigeria by Nestlé S.A has reduced the volatility of the company share price, with the parent company consistently mopping up stray volumes on the bourse.
About the company
Nestlé Nigeria PLC is one of the largest foods and beverage companies in Africa, and the largest consumer goods company by market capitalization. Nestlé Nigeria Plc engages in the manufacturing, marketing and distribution of food products including purified water. It also exports some of its products to other countries within Africa.
It has three product segments: Food, Beverages, and seasoning. The Food segment engages in the production and sale of Cerelac, Nutrend, Nan, Lactogen and Golden Morn. The Beverages segment engages in the production and sale of Milo, Chocomilo, Nido, Nescafe and Nestlé Pure Life. While the seasoning segment engages in the sale of Maggi cubes.
Olam International upsizes debt facility to $1.98 billion, to refinance its loans
The company announced that it has upsized its flagship $1.675 billion multi-tranche revolving credit facility.
Leading food and agri-business company, Olam International, has announced that it has upsized its flagship debt facility of $1.675 billion by $300 million, to $1.975 billion. The debt facility will be disbursed to refinance existing loans of Olam and its subsidiaries.
This information was disclosed by the company in a press release yesterday, which was seen by Nairametrics.
According to the information contained in the press release, the company announced that it has upsized its flagship $1.675 billion multi-tranche revolving credit facility that was secured on September 10, 2020, by an additional $300 million.
The upsized facility of $1.975 billion, which has Olam’s wholly-owned subsidiary, Olam Treasury Pte. Ltd. (“OTPL”) as a co-borrower, consists of three tranches – a 364-day revolving credit facility of $790 million, a 2-year revolving credit facility of $790 million and a 3-year revolving credit facility of $395 million.
The Management of Olam emphasized that the proceeds from the credit facility provided by a total of 25 banks, will be deployed efficiently towards refinancing existing loans of Olam and its subsidiaries.
However, the debt facility will also help the company strengthen its balance sheet, and enable the leading agri-business group to execute its plans and strategy while supporting our customers, farmer-suppliers, and other stakeholders, as they navigate through the impact of COVID-19.
In an earlier press release on September 10, 2020, Olam International confirmed that 21 lenders participated in the flagship debt facility of $1.675 billion.
Four new banks have now joined the facility – Bank of Baroda as a Senior Mandated Lead Arranger, Bank of China, Unicredit Bank AG as Mandated Lead Arrangers, and Westpac Banking Corporation as a Lead Arranger; taking the total lenders to 25 banks.
Recall, in a press release on June 18, 2020, Olam international said it secured a revolving sustainability-linked credit facility aggregating $250 million, which is linked to meeting key sustainability performance indicators, aligned with the three Purpose outcomes of the Company’s sustainability strategy. The KPIs will be tracked and reported by Olam’s Corporate Responsibility & Sustainability team, while Ernst & Young will perform procedures to independently assess the achievement of the KPIs.
However, the upsized facility of $1.975 billion and other facilities since 2018 which amount to $1.675 billion, brings the total consideration of the group’s credit facility to $3.65 billion.
Guinness’ parent company expects alcohol sales to improve as restaurants and bars gradually reopen
Diageo Plc expects a sequential improvement in organic net sales and operating profit compared to the first half of fiscal 2020.
The parent company of Guinness Nigeria Plc, Diageo Plc disclosed that it expects sales in July to December to improve, compared to the first six months of the year as bars and restaurants reopen following coronavirus lockdowns.
This was disclosed by the CEO of Diageo Plc, Ivan Menezes, in a press release by the company today.
Ivan Menezes said that Diageo has made a good start to the fiscal year 2021, with sequential improvement in the Group’s performance across all regions, driven by strong execution, robust demand in the off-trade channel, and the gradual re-opening of the on-trade channel in most markets.
However, as the pace of recovery from the COVID-19 pandemic, and easing of government restrictions varies by region and market, the CEO expressed optimism in the US business, as it is performing strongly ahead of expectations, reflecting resilient consumer demand, as the spirits category continues to gain share within the total beverage alcohol market.
In Europe, off-trade demand remains robust, and the on-trade channel has largely re-opened with the easing of lockdown measures in most countries, although the risk of additional restrictions remains where infection rates are worsening.
While speaking about the performance of Diageo’s subsidiaries operating outside of the U.S. and Europe, Mr. Menezes maintained a cautious stance; “the on-trade has also begun to re-open in Africa and other regions, and as such, we expect the pace of recovery in those markets to be more gradual, as travel retail continues to be severely impacted.”
Outlook for the first half of the fiscal year 2021
On the outlook for the first half of the fiscal year 2021, Diageo Plc expects a sequential improvement in organic net sales and operating profit, compared to the second half of fiscal 2020, but organic net sales and margin dilution in the first half of the fiscal year 2021, is expected to be lower than the first half of the fiscal year 2020.
Menezes noted that the resilience of the Group’s business and trade segment in the current challenging operating environment is really impressive. Though recovery is uncertain in the near-term, he is confident in the company’s strategy, coupled with its long-term fundamentals, as enabling factor to emerge stronger.
Diageo products are sold in more than 180 countries around the world, it is a global leader in beverage alcohol, with an outstanding collection of brands including Johnnie Walker, Crown Royal, JεB, Buchanan’s and Windsor whiskies, Smirnoff, Cîroc and Ketel One vodkas, Captain Morgan, Baileys, Don Julio, Tanqueray, and Guinness.
Diageo Overseas holdings limited, is the parent organization of Guinness Overseas Limited. Guinness Overseas Limited, as of 30 June 2020, owned 50.18% of the issued share capital of Guinness Nigeria Plc.
Floods disrupt operations in Flour Mills’ Sugar Estate
Heavy floods at Flour Mills’ Sunti Golden Sugar Estate has disrupted its operations.
Sunti Golden Sugar Estate (SGSE), owned by Flour Mills, has suffered some disruptions to its operations as floodwater breached the Sugar Estate.
This information was gathered by Nairametrics from a notification sent to the Nigerian Stock Exchange and signed by the Company’s Secretary, Umolu Joseph A. O.
The largest miller by market capitalization, explains that the floods were as a result of the long rainfalls recorded recently at the northern and central parts of the Niger basin, as the floods were triggered by severe downpours at the Sokoto Rima basin, and as a consequence, the Kainji and Jeba dams witnessed an upsurge in the lateral flow of water.
The Management stated that SGSE has suffered some disruptions to operations, as the resulting high inflows in the downstream Niger River caused a breach to the extensive and properly designed dyke systems at Sunti Golden Sugar Estates (SGSE).
This development is expected to delay the expansion project, geared towards increasing the area under cultivation to 4,000 hectares by mid-2021.
The Miller assures stakeholders, that there is no immediate threat to the earlier indicated earnings projections of FMN, as immediate safety protocols have been instituted to safeguard employees, property and equipment. Hence the breach is not foreseen to impact the overall performance of the Group.
The company informs investors and other key stakeholders that the actual state of damage to the current sugarcane crop at Sunti, can only truly be assessed once the floodwater subsides, and ensures that it will release further details in due course as the need arises.
Shares of Flour Mills at the end of the trading session on Friday closed at N21.50, and this is 6.70% higher than the market opening price for the day, 8.59% higher than the market opening price for the week, and 14.36% higher than the market opening price for the month. While the YTD gains stood at 9.14%.
Flour Mills shares are currently trading in the overbought zones, going with the agreement of Technical Momentum Indicators, like the William Percentage Range, the Relative Strength Index and its stochastic variant, as the shares of the company are driven by strong fundamentals.
In like manners, the company shares currently trade at 21.15x earnings per share (EPS), and 0.57x book value per share (BVPS), with a Market capitalization of N81.628 billion.