The Nation Newspaper

Category: Equities

  • Stock Exchange mulls new platform for SMEs

    The Nigerian Stock Exchange (NSE) is considering creation of a special-purpose platform to nurture small and medium scale enterprises (SMEs) by providing them with opportunity to list their shares and raise capital from the stock market.

    The new board, to be known as the ‘Growth Board’, is designed to support the growth of SMEs as part of the strategic initiatives by the Exchange to enhance its traditional roles as catalyst for economic growth and development.

    According to the draft document on the new board, the Exchange’s traditional role as an enabler of capital flow from areas of surplus to deficit holds good promise for its capability to support SMEs as access to capital is the prime challenge faced in the SME sector.

    The Exchange stated that it decided to have a dedicated board for SMEs because the capabilities of most SMEs do not allow them to meet stringent listing and post-listing requirements and fees required for listing on the other boards of the Exchange.

    The ‘Growth Board’ will recognise and encourage the listing of fast growing companies that are active in their respective sectors, and have exhibited high growth potential.

    According to the Exchange, the objective of the ‘Growth Board’ is to develop a listing board that is suited to the needs of start-ups and SMEs that will act as a vehicle to attract fast growing issuers to list on the Exchange, increase overall market capitalisation and order flow in line with the Exchange’s strategic objectives.

    Stock Exchange

  • Notore Chemical gets nod to list N100.75b shares

    Notore Chemical Industries Plc, an agro-allied and fertiliser company sold to private investors by the Federal Government in 2005, has received regulatory approval to list its N100.75 billion shares on the Nigerian Stock Exchange (NSE).

    Regulatory documents obtained at the weekend indicated that Notore Chemical Industries will be listing by the way of introduction 1.61 billion ordinary shares of 50 kobo each at N62.50 per share. This will make Notore Chemical the largest listed agro-allied company.

    Sources in the know said Notore Chemical decided on the listing by way of introduction to make its shares available for trading on the stock market, preparatory to floating its initial public offering (IPO).

    Notore Chemical had earlier received initial approvals to raise about N20 billion in initial public offering (IPO) and another N6.2 billion in an offer for sale. The company had earlier in 2012 indicated it could raise N160 billion in IPO.

    Notore had received approvals from the NSE for the IPO and the subsequent listing of its shares on the Exchange.

    According to the details, Notore had planned to float an IPO for 371.59 million ordinary shares of 50 kobo each at N52.72 per share. The company also planned an offer for sale for 117.34 million ordinary shares of 50 kobo each at the IPO’s price of N52.72 per share.

    While the net proceeds of the N19.6 billion IPO would be used for financing the business of the company, the net proceeds of the N6.2 billion offer for sale would go to the selling directors and existing shareholders.

    A source said the offer for sale was a profit-taking mechanism for the private investors who had bought the company from the Federal Government in 2005.

    The Onne, Rivers State-based company had in 2012 signed a joint venture agreement with Mitsubishi Corporation of Japan for the con-struction of an integrated complex with production capacities of 1,700 metric tonnes of ammonia, 3,000 metric tonnes of urea and 1,300 metric tonnes of other petrochemicals per day. The agreement also included Mitsubishi Heavy Industries, which was contracted to carry out the pre-front end engineering design (Feed) for the project.

    Notore had earlier signed a technical service agreement with Tata Chemicals for the technical operations and optimisation of the existing Onne plant.

     

  • Prestige Assurance seeks to increase share capital after reduction

    Prestige Assurance Plc is seeking to increase its authorised share capital to N3 billion of 6.0 billion ordinary shares of 50 kobo each.

    Shareholders of the insurance company are expected to vote today on special resolutions that will enable the board of directors of the company to create 1.55 billion ordinary shares of 50 kobo each.

    Prestige Assurance plans to increase its authorised share capital from N2.223 billion to N3 billion. Shareholders are also expected to vote on a resolution authorising the board of the company to distribute bonus shares of 41 ordinary shares for every 100 ordinary shares held by the shareholders.

    The company plans to capitalise N782.57 million from its share premium account to pay for the new shares issuance. The scrip issue will increase the company’s issued share capital from N1.91 billion to N2.69 billion.

    Prestige Assurance last week concluded share reconstruction exercise that resulted in cancellation of about 1.6 billion ordinary shares of 50 kobo each. The reconstruction was undertaken to remove bubble assets.

    The Nigerian Stock Exchange (NSE) on June 7, 2018 lifted the full suspension placed on trading in the shares of the company to mark the conclusion of the share reconstruction exercise.

    The NSE stated that Prestige Assurance had notified it that the exercise had been completed and the shareholders’ register updated accordingly before the Exchange decided to lift the suspension.

    Under the share reconstruction, Prestige Assurance had reduced its share capital from N2.685 billion or 5.370 billion ordinary shares of 50 kobo each to N1.909 billion or 3.817 billion ordinary shares of 50 kobo each in the issued and fully paid up ordinary shares of the company.

    This led to reduction of N776 million or 1.55 billion ordinary shares. “The share capital so reduced will be applied in writing off the capital of the company which is lost or unrepresented by available assets,” according to a regulatory filing on the reconstruction.

    Prestige Assurance had stated that the essence of the capital reconstruction was to enable it wipe out its accumulated retained losses of N776.511 million.

    The company noted that the reconstruction would reposition it on a trajectory for subsequent accumulated retained profit while creating more value to its shareholders.

    Besides, the reconstruction would allow the company to declare dividend and improve its perception in the market thereby making it more competitive.

    Shareholders of the insurance company had on Friday, August 18, 2017 at its 47th annual general meeting (AGM) in Lagos approved the share reconstruction and authorised the board of directors to take necessary actions to implement the share reduction.

    Established in 1952 as a branch office of The New India Assurance Company Limited, Mumbai, Prestige Assurance was incorporated as a limited liability company on January 6, 1970 and licensed to write all classes of non-life insurance in Nigeria. In order to reflect the majority shareholding of the public in the company, its name was changed to Prestige Assurance Plc on September 24,1992 in line with the indigenisation decree passed by government of Nigeria. After successful recapitalization in 2007 and subsequent rights issue in 2015, Prestige Assurance is a subsidiary company of The New India Assurance Company Ltd, Mumbai, which has majority equity stake of 69.5 per cent shareholding.

     

  • SEC okays FMDQ’s clearing house

    Securities and Exchange Commission (SEC) has registered FMDQ Clear Limited, a central clearing house promoted by the FMDQ OTC Securities Exchange.

    In a statement, FMDQ stated that the clearing house will deliver highly efficient post-trade services across Nigeria’s fixed income and derivatives markets, addressing some of the key drivers for the development of the markets.

    The clearing house will ensure risk mitigation, capital efficiency, price transparency, safety, stability, confidence and inclusiveness in the marketplace.

    According to FMDQ, FMDQ Clear has commenced initiatives to ensure that its risk management activities underpin its effectiveness, reliability and long-term sustainability, as it strives to resolve key clearing and settlement issues.

    FMDQ Clear has also formally partnered with Frontclear, which provides third-party settlement guarantee funds (SGFs), to further strengthen the clearing house risk waterfall framework, with a third-party settlement guarantee arrangement that improves on settlement finality, a first of such infrastructure in Africa.

    “The establishment of this clearing infrastructure, FMDQ Clear, will greatly contribute to making the Nigerian inter-bank market globally competitive, operationally excellent, liquid and diverse, in line with FMDQ’s GOLD Agenda for the transformation of the Nigerian financial markets, as participating clearing and dealing members will have expanded access and in turn, be better able to serve the needs of their client base and the real economy,” FMDQ stated.

     

  • Equities sustain recovery with N329b gain

    Nigerian equities sustain a two-day consecutive rally yesterday with a net capital gain of N329 billion as investors stepped up demand for shares that had witnessed considerable decline in recent period. With more than two gainers for every loser, equities recorded average gain of 2.46 per cent, reducing the negative average year-to-date return to -1.02 per cent.

    The All Share Index (ASI)-the benchmark index at the Nigerian Stock Exchange (NSE) rose from its opening index of 36,947.10 points to close at 37,854.92 points. Aggregate market value of all quoted equities increased from N13.383 trillion to close at N13.712 trillion.

    Most sectoral indices closed on the upside as bargain-hunters sought to lock in positions from banking sector to industrial and commercial goods sectors. The NSE Industrial Goods Index and NSE Banking Index rose by 3.2 per cent each. The NSE Consumer Goods Index appreciated by 2.7 per cent the NSE Insurance Index inched up by 0.2 per cent. On the downside, the NSE Oil & Gas Index declined by 0.6 per cent.

    Nigerian Breweries led the gainers with a gain of N5.30 to close at N111.30. Dangote Cement rose by N5 to close at N228. Okomu Oil Palm appreciated by N4 to close at N84. International Breweries added N3 to close at N42 while Lafarge Africa chalked up N1.65 to close at N34.75 per share.

    On the downside, Total Nigeria led the losers with a loss of N8.70 to close at N193.30. Presco declined by 90 kobo to close at N70.35. UAC of Nigeria dropped by 70 kobo to close at N14. Ecobank Transnational Incorporated dropped by 10 kobo to close at N19 while NPF Microfinance Bank lost 6.0 kobo to close at N1.69 per share.

    Total turnover stood at 339.68 million shares valued at N5.96 billion in 4,436 deals. Access Bank was the most active stock with a turnover of 133.07 million shares valued at N1.42 billion. Guaranty Trust Bank followed with a turnover of 39.32 million shares worth N1.62 billion while United Bank for Africa placed third with a turnover of 23.23 million shares worth N258.47 million.

    “In line with our expectations, today (Tuesday)’s performance was largely driven by bargain hunting in large cap value stocks and we believe this will remain a key driver in the near term,” Afrinvest Securities stated.

    Analysts at SCM Capital stated that the current sentiment will most likely persist today as overall market valuation remains cheap.

     

  • Standard Bank Group stakes N61.3b to acquire higher shares in Stanbic IBTC Holdings

    • Now holds 64.44% majority stake

    Standard Bank Group-Africa’s largest financial institution, dug deep into its Nigerian business last week with the acquisition of additional shares worth N61.3 billion in Stanbic IBTC Holdings Plc to increase its majority equity stake in the Nigerian subsidiary to 64.44 per cent.

    In a regulatory filing announcing the transaction, Company Secretary, Stanbic IBTC Holdings Plc, Chidi Okezie, confirmed that Stanbic Africa Holdings Limited, a wholly owned subsidiary of Standard Bank Group Limited, has acquired additional 1.14 billion ordinary shares of 50 kobo each in Stanbic IBTC Holdings. Stanbic Africa Holdings Limited represents Standard Bank Group in Nigeria as the parent company of Stanbic IBTC Holdings Plc. The acquisition was done in an “off-market” transaction.

    “With this acquisition, the total percentage shareholding of Stanbic Africa Holdings Limited in Stanbic IBTC has increased by 11.35 per cent from 53.09 per cent to 64.44 per cent post this transaction,” Okezie said.

    Sources in the know about the deal said the South African banking group had opted to buy the Stanbic IBTC Holdings shares at premium. The deal was struck at N53.75 per share, considerably higher than Stanbic IBTC Holdings’ current market price of N46.10 and 52-week highest price of N50.05 per share at the Nigerian Stock Exchange (NSE). The shares were transferred to Stanbic Africa Holdings in eight deals, which were consummated through the NSE.

    As an off-market, negotiated cross deal, it means that the deal was not subjected to the dynamics of price discovery for the particular period. Off-market trade implied that the deal was sealed outside NSE floor.

    The negotiated cross deal platform of the Exchange is a special-purpose trading platform that is meant for voluminous transaction. By the cross deal, it implies that the buyer and the seller had been pre-arranged and the transfer at the stock market was a mere perfection of the agreement between the two. The negotiated cross deal allows the parties to  close the deal at reduced cost.

    Stanbic IBTC Holdings recorded its most profitable year since inception of the bank in 2017. Key extracts of the audited report and accounts of Stanbic IBTC Holdings for the year ended December 31, 2017 showed that gross earnings rose by 36 per cent while profit after tax jumped by 70 per cent. Gross earnings rose to N212.4 billion in 2017 as against N156.4 billion in 2016. Profit before tax increased from N37.2 billion to N61.2 billion while profit after tax rose to N48.4 billion as against N28.5 billion in 2016.

    Total assets increased to N1.386.4 trillion in 2017, a 32 per cent growth on N1.053 trillion recorded in 2016. The growth in the balance sheet size was driven mainly by customer deposits, which recorded a growth of 34 per cent to N753.6 billion in 2017 from N561.0 billion in 2016. Gross loans and advances grew by eight per cent to N403.9 billion compared to N375.3 billion recorded in 2016.

    Chief Executive, Stanbic IBTC Holdings Plc, Yinka Sanni, said the strong performance of the bank was evidence of the positive outcome of the group’s strategy of growing the client base across target and key market segments while maintaining a principled credit process.

    “The group reported its best profitability results since inception. We achieved a 70 per cent growth in profit after tax amid healthy capital and liquidity levels. Our balance sheet grew by 32 per cent to N1.39 trillion and this was funded mainly by customer deposit growth of 34 per cent,” Sanni said.

    Stanbic IBTC had in 2012 adopted a holding company structure in line with the new banking regulatory regime of the Central Bank of Nigeria (CBN). Under the structure, the subsidiaries of Stanbic IBTC Holdings Plc are Stanbic IBTC Bank, Stanbic IBTC Pension Managers Limited, Stanbic IBTC Asset Management Limited, Stanbic IBTC Trustees Limited, Stanbic IBTC Capital Limited, Stanbic IBTC Stockbrokers Limited, Stanbic IBTC Insurance Brokers Limited, Stanbic IBTC Ventures Limited and Stanbic IBTC Investments Ltd. Stanbic IBTC Nominees Nigeria Limited and Stanbic IBTC Bureau de Change Limited are the only subsidiaries of Stanbic IBTC Bank.

  • SEC warns investors over banned firms

    Securities and Exchange Commission (SEC) has warned investors to shun a proposed restructuring plan by Partnership Investment Company and its subsidiaries.

    In a circular, SEC stated that its attention had been drawn to an electronic message being circulated to investors on behalf of Partnership Investment Company Plc and its subsidiaries, purporting to be undergoing restructuring.

    SEC noted that following the hearing of the complaints against the Partnership Investment Company and its subsidiaries in June 2017, the Administrative Proceedings Committee (APC) of the Commission had cancelled the registration of the Partnership Investment Limited and Partnership Securities Limited and banned the principal officers and executives of the companies from participating in the capital market.

    “In view of the above, the general public is hereby warned to be wary of the proposal and hereby direct Partnership Investment Company Plc and its subsidiaries to submit their repayment plan officially to the Commission for the protection of affected investors,” SEC stated.

  • Conoil to pay N1.4b dividend

    The board of Directors of Conoil Plc has recommended distribution of N1.4 billion to shareholders as cash dividend for the 2017 business year. Shareholders will receive a dividend per share of N2.

    The proposed dividend is expected to be approved by shareholders at the company’s next annual general meeting in Uyo, Akwa Ibom State.

    In a regulatory filing at the Nigerian Stock Exchange (NSE), the company board stated that it had met and approved that dividend warrants will be dispatched on July 9, 2018 to members whose names appear in the register of members at the close of business on June 8, 2018.

    The board also approved that members’ register and the company transfer books be closed from June 11, 2018 to June 15, 2018, (five days) to enable the preparation and payment of dividends.

    Conoil has maintained a consistent dividend payout history. Between 2012 and 2016, the company had paid a total of N8.4 billion as dividend.

    Audited report and accounts of the company for the year ended December 31, 2017, showed that turnover rose by 35.9 per cent from N85.02 billion in 2016 to N115.51 billion in 2017. Profits before and after tax, however, stood at N2.30 billion and N1.58 billion respectively in 2017. Earnings per share closed in 2017 at N2.27.

    The company attributed its performance to sustained culture of financial discipline, prudent and efficient execution of projects and plans, aggressive product development and marketing, supported by cutting-edge customer service delivery.

    While assuring that its promise to its shareholders remains maximum value, it reiterated delivery of excellent service and products to its customers.

     

  • May & Baker Nigeria concludes plan for new capital raising

    May & Baker Nigeria Plc is finalising arrangements to raise new capital through a rights issue as the company seeks to recapitalise its operations to drive a new vision of being the dominant healthcare brand in the Sub-Saharan Africa region.

    At its annual general meeting in Lagos, shareholders voted unanimously to increase the authorised share capital of the healthcare company from N1.9 billion of 3.8 billion ordinary shares of 50 kobo each to N3 billion of 6.0 billion ordinary shares of 50 kobo each. Shareholders also authorised the board of the company to sell or lease any one of the company’s two properties located at Sapara Street, Ikeja. Shareholders had in 2014 empowered the company to raise N3.2 billion new equity capital.

    Chairman, May & Baker Nigeria Plc, Lt. Gen Theophilus Danjuma (rtd), said directors of the company believe that the time is now right to raise the funds to enable the company harness new opportunities.

    “Therefore, our rights issue will soon open and I hope shareholders will take up their rights to support our company in achieving its new vision. We shall all reap the rewards in the immediate future and beyond,” Danjuma said.

    He outlined that the company has envisioned a new vision that will see it dominating the Sub-Saharan Africa (SSA) markets in line with its new vision of being the leading healthcare brand in SSA.

    According to him, the new five-year strategic plan of the company entails focus and expansion along the company’s competitive advantage of healthcare and it will soon begin to establish footprints and seek dominance in this area in the SSA region.

    He pointed out that in line with its new vision and following shareholders’ approval given at the extra-ordinary general meeting in November 2017, the company had successfully completed the divestment from its noodles business in the first quarter of 2018, adding that the gain from the divestment will be recorded in the current year’s results.

    Danjuma, who was represented by a non-executive director, Dr. Edugie Abebe, said streamlining the company’s activities along its core area of healthcare will put it in a position to deliver stronger profits in the future.

    Shareholders commended the board and management of the company for the increase in dividend payout to 20 kobo for the 2017 business year.

    Its Managing Director, Mr. Nnamdi Okafor, said the company decided to optimise its assets by selling the dormant property and reinvest the proceeds in development of its Abuja property and acquisition of another property around its Ota manufacturing complex.

    He said the company realised N775 million from the divestment of its noodles business, noting that the company will start the construction of its vaccines factory by the third quarter of 2018.

  • NSE halts trading on Paints & Coatings Manufacturers

    The Nigerian Stock Exchange (NSE) has suspended trading on the shares of Paints and Coatings Manufacturers Nigeria (PCMN) Plc as the company moves to finalise its voluntary delisting from the Exchange.

    Authorities at the Exchange said they decided to suspend trading on the shares of the paints company with effect from Wednesday May 30, 2018 in line with the effective date for determining the shareholders, who will qualify to receive the scheme shares ahead of the implementation of the voluntary delisting of the company.

    PCMN shareholders had earlier this year approved sub-joined resolutions that will see the relapse of the company to a private limited liability company and the delisting of its shares from the NSE. A new company-Paintcom Investment Nigeria Limited is proposed to emerge after the delisting.

    The Asset Management Corporation of Nigeria (AMCON) had recently sold the fourth largest equity stake in PCMN to Bizfeat Ventures Limited, a relatively unknown firm. AMCON, the bad-debt resolution corporation, floated by the government, transferred its 7.4 per cent equity in PCMN to Bizfeat Ventures through a negotiated cross deal at the NSE.