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Corporate deals

DEAL: CAP Plc completes merger with Portland Paints

The merger with Portland Paints will make CAP the largest player in the Nigerian paints market by market share.

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CAP Plc is running at a risk of increased bad debts

Chemical Allied Products Plc (CAP) has been authorised to receive all the assets, liabilities, product offerings, and property rights of Portland Paints and Products Nigeria Plc.

This was one of the resolutions passed at the court-ordered meeting of the Shareholders of CAP Plc which held on Thursday, February 18, 2021, at Radisson Blu Hotel in Lagos

According to the statement which contains the resolutions made at the court-ordered meeting issued by the Company Secretary, Ayomipo Wey, which was seen by Nairametrics, “Chemical Allied Products Plc “is hereby authorised to enter into a merger, and business consolidation with Portland Paints such that, upon an order of the Court, all assets, liabilities of Portland Paints including but not limited to real property, intellectual property rights, permits, credits, allowances, equipment and machinery, plant, fixtures and fittings, motor vehicles and businesses as at the Effective Date shall be transferred to the Company without further act or deed by the parties”.

READ: CAP Plc’s share price is beginning to tank

Resolutions made at the court-ordered meeting

  • In view of the merger with Portland Paints, and to give effect to the full completion of the Scheme Merger, CAP Plc is hereby authorized to pay Cash Consideration of N2.90 to the Scheme Shareholders for each ordinary share of N0.50 held in Portland Paints as at close of business on the Terminal Date.
  • Upon the Scheme becoming effective, the CAP Plc is hereby authorized to allot up to 99,176,942 shares to Shareholders of Portland Paints Plc who elect to receive the Share Consideration, as the shareholders hereby waive their pre-emptive rights to any such shares.

READ: CAP Plc Managing Director resigns

What you should know

  • According to a statement made by the Managing Director of CAP Plc, David Wright, the post-merger entity of Chemical Allied Products Plc and Portland Paints and Products Nigeria Plc would be the largest player in the Nigerian paints market by market share.
  • The “Enlarged CAP” as it’s fondly called is expected to dominate the Nigerian Market as the largest player in the paints and decorative industry, as the entity is expected to float an enlarged product portfolio with strong brands, and a rich product mix of CAP and Portland Paints in the standard, premium, industrial and marine/protective segments.
  • Hence, with a formidable product portfolio, the entity will leverage the strength of powerful brands like Dulux, Sandtex, Caplux and Hempel, as the “Enlarged CAP” will command a diversified product range across the decorative and marine segments.
  • Upon the completion of the merger, the “Enlarged CAP” is expected to have an estimated market share of 14.9%, with a product portfolio which cuts across the Decorative, Industrial, Marine and Protective segments, with 26 product offerings in total.
  • These product offerings will be distributed across 91 stores across 32 states in the country, as the enlarged entity will leverage the benefits of a wider distribution network.

Omokolade Ajayi is a graduate of Economics, and a certificate holder of the CFA Institute’s Investment Foundation Program. He is a business analyst, and equity market researcher, with wealth of experience as a retail investor. He is a business owner and a stern advocate of Financial literacy, who believes in the huge economic prospect of the Nigerian Payment channels and Fintech space.

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Corporate deals

DEAL: Tangerine Life completes take-over of ARM Life Insurance Plc

Tangerine Life Insurance has concluded the acquisition of ARM Life Plc.

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Tangerine Life Insurance, a subsidiary of Verod Capital Limited has concluded the acquisition of ARM Life Plc.

This is according to a press release issued by the firm’s Head, Brand and Communications, Olabisi Adesokan, seen by Nairametrics.

The merger is expected to consolidate and optimize the unique strengths of both sides, both in the corporate and retail markets, creating a stronger and broader insurance and financial services platform that will be of immense benefits to all.

READ: Buhari reappoints Bala Usman as MD of NPA, reconstitutes the Board

Background of the deal

A decision to complete the acquisition of ARM Life Insurance Plc was reached at Tangerine’s Board Meeting held on 4th of March, 2020, where the provisions of section 131 of the Investment and Securities Act (ISA) 2007 was triggered.

Provisions in section 131 of ISA 2007 had empowered Tangerine Life Insurance to takeover ARM Life, following its 77.72% equity stake held in the latter, which translates to 7,392,953,710 ordinary shares.

In lieu of this, a decision to buy-out the remaining stake of 2,180,967,082 ordinary shares at N0.63 was ratified at the Board meeting and subsequently implemented.

READ: Report any employer without Group Life Insurance for employees – PenCom

Deal book 300 x 250

What they are saying

Commenting on the rationale behind the deal, the Managing Director of Tangerine Life, Livingstone Magorimbo said: “Integrating the businesses has presented us a tremendous opportunity to enhance our capabilities, improve operating efficiencies and grow our businesses.

“At Tangerine Life, we will continue to innovate, drive positive change within the insurance industry and create tremendous value for our customers towards effectively positioning our business to stay ahead of the next wave of industry evolution.”

On the other hand, a former Managing Director at ARM Life, Stephen Alangbo added that: “Innovation is paramount in ensuring customer satisfaction in today’s business landscape. We believe that the combination of both entities will ensure exceptional value creation for existing and new customers and partner.”

What you should know

  • According to the press release, the merger places Tangerine Life as the 4th largest life insurer in Nigeria and position it for future growth.
  • Tangerine Life Insurance Limited, formerly known as Metropolitan Life Insurance Nigeria Limited was incorporated on 19 August 2004 and licensed by NAICOM on 14 February 2007. It is principally engaged in the provision of group life, credit life and individual life products to over 12,000 blue-chip corporate and retail clients.
  • The Company is majorly owned by Oreon LMS Limited, a subsidiary of Verod Capital Growth Fund II, a US$115 Million private equity fund managed by Verod Capital Management Limited.

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Corporate deals

DEAL: FMDQ Exchange admits Parthian Partners Limited’s Commercial Paper worth N20 billion

FMDQ has ratified the admission of Parthian Partners Limited’s N20 billion Commercial Paper.

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Dangote cement, FMDQ changes company name, FMDQ Clear Limited, Securities and Exchange Commission

The Board Listings, Market and Technology Committee of FMDQ has ratified the admission of Parthian Partners Limited’s commercial paper worth N20 billion into the FMDQ Exchange platform.

This is according to a verified tweet by FMDQ Exchange, which reads; “FMDQExchange is pleased to announce the approval for the registration of the Parthian Partners Limited ₦20.00 billion Commercial Paper Programme on its Platform.’’

Prior to the recent admission, Nairametrics had earlier reported that a total of six (6) commercial papers valued at N22.29 billion have been admitted to FMDQ platform since the beginning of this year, with the latest being the admission of Coronation Merchant Bank’s CP series worth N3.63 billion.

Recall that since 2014, FMDQ Exchange has continued to champion the reform of Commercial Papers market, in collaboration with the CBN and through the deployment of key initiatives and strategies, part of which made it possible for the Exchange to cross the N1 trillion mark in 2018.

What this means

  • Nairametrics understands that Parthian Partners Limited, just like other issuers quoted on the FMDQ Exchange, will enjoy some value-driven services such as; gaining access to a wide range of knowledgeable and capitalised investors, enhanced liquidity among others.
  • The Commercial Papers will enable Parthian Partners Limited plug its capital shortfalls and meet up with its short-term liquidity, sustaining its business through the process.

What you should know

  • It is pertinent to note that Commercial Papers quoted on FMDQ’s platform are quoted on FMDQ and traded on the FMDQ-Bloomberg E-Bond Trading and Surveillance System
  • FMDQ Debt Market size as at close of business on 23rd of February, 2021 currently stands at N23.07 trillion.

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