The Nation Newspaper

Category: Investors

  • Exchange downgrades Red Star Express to low-priced stock

    The Nigerian Stock Exchange (NSE) has reclassified Red Star Express Plc from a medium-priced stock to low-priced stock, underlining the decline in the share price of the logistics company.

    The Exchange said the review of Red Star Express stock price trade activity over the most recent six- month period provided the basis for reclassifying the security from the medium priced stock group to the low priced stock group.

    Red Star Express’ stock price dropped below the N5 threshold on September 17, 2018 and traded below N5 up till close of business on January 17, 2019. This indicated that Red Star Express stock price has traded below N5 in four out of the last six months. The reclassification took effect from January 28, 2019.

    As a low-priced stock, stockbrokers would need 100,000 shares to move the share price of Red Star Express as against 50,000 shares needed for price change as a medium-priced stock. Also, the tick size for the company will change from five kobo to one kobo, implying that the share price will rise slowly going forward.

    The NSE classifies quoted companies into three categories-high-priced, medium-priced and low-priced stocks, based on their market price.

    The high-priced stocks consist large-cap equities that are priced at N100 per share or above for at least, four of the last six trading months, or new security listings that are priced at N100 or above at the time of listing on the Exchange.

    The medium-priced stocks consist of medium-priced equities that are priced at N5 per share or above, but less than N100 per share for at least, four of the last six months, or new security listings that are priced at N5 per share or above but less than N100 per share at the time of listing on the Exchange.

    The low-priced stocks, where majority of listed companies fall, consist of equities that are priced at one kobo per share or above but below N5 per share for at least four of the last six months, or new security listings that are priced at one kobo per share or above but below N5 per share at the time of listing on the Exchange.

    Stocks under high-priced group shall have price change with minimum of 10,000 units; stocks under medium-priced group shall have price movement with a minimum of 50,000 units while stocks under low-priced group shall have price change with minimum volume of 100,000 units.

     

  • Sovereign Trust Insurance gets regulatory approval to raise N2.09b

    Authorities at the Nigerian Stock Exchange (NSE) have given the nod to Sovereign Trust Insurance Plc to proceed with its new capital raising exercise. Sovereign Trust Insurance is seeking to raise N2.09 billion from existing shareholders as the insurance company seeks to beef up its capital base to place it in better stead for large-ticket transactions.

    A circular obtained yesterday by The Nation indicated that the Quotation Committee of the Exchange has approved the N2.085 billion rights issue, paving the way for the insurance company to round off the pre-offer process and open acceptance list for the rights issue.

    Under the rights issue, Sovereign Trust will issue 4.17 billion ordinary shares of 50 kobo each at offer price of 50 per share. As rights, the new shares to be issued have been pre-allotted on the basis of one new share for every two ordinary shares held as at the close of business on  January 15, 2019.

    Shareholders of Sovereign Trust had recently approved a new capital raising plan for the insurance company, on the heels of the cancelled tier-based minimum solvency capital policy proposed by the National Insurance Commission (NAICOM).

    Shareholders authorised the board of the company to create 5.0 billion new ordinary shares of 50 kobo each to increase its authorised share capital to N10 billion of 20.0 billion ordinary shares of 50 kobo each.  Shareholders also approved the proposal to raise “additional equity capital for the company up to the maximum of the authorised share capital” with additional mandate to the board to absorb excess money in the event of oversubscription of the initial offer.

    Under its capital raising plan, Sovereign Trust could raise funds by issuing new shares to existing shareholders, new general retail investors, existing and new strategic investors or a combination of many means of capital raising.

    While NAICOM has cancelled the new tier-based capitalisation programme, market analysts believed that many insurance companies that had launched emergency capital raising plans may go ahead with their plans as proactive measures. Many analysts expected a considerable consolidation of the Nigerian insurance sector, with capitalisation as a major benchmark.

     

  • Analysts pick Presco, Okomu for high returns

    Nigerian oil palm industry is poised for a boom and  two quoted palm oil companies, Presco Plc and Okomu Oil Palm Plc, have prospects to deliver considerable cash dividends and share price appreciation in the years ahead.

    In its report on the Nigerian oil palm industry, Afrinvest (West Africa) Limited said the Nigerian oil palm industry will witness continued growth in the years ahead with positive earnings and profitability of listed companies to improve at a faster pace over the forecast period.

    The 42-page report concluded that Presco and Okomu Oil Palm are expected to record significant price growth and capital appreciation in the years ahead, while providing annual dividend income for investors.

    The report noted that the two quoted companies have focused on expanding production, especially over the last three years by investing in increasing total land area under cultivation, expanding milling and refining facilities to meet up with expected additional output.

    “We hence expect both companies to record continuous revenue and profitability growth over our forecast period,” Afrinvest said.

    The oil palm industry, the report said,  is keenly positioned to soar further over the coming years as investments in expanding milling and refining capacity of listed sector players crystallise. Also, the sector, which has ridden on positive government support since 2015, based on oil palm import restrictions introduced by the Central Bank (CBN), has provided premium pricing opportunity for players. Similarly, the Federal Government posture towards supporting agriculture has enabled low cost capital expenditure financing by industry participants compared with other sectors in Nigeria.

    At Okomu Oil Palm, the report listed the growth factors to include enlarged plantation with oil palm and rubber trees on about 8,809 hectares and 1,989 hectares to mature within the forecast period expansion in milling capacity first from 60.0 FFB MT per hour in 2017 to 75.0 FFB MT per hour in 2019 and to 90.0 FFB MT per hour by 2021.

    Also, the management of Okomu Oil Palm has confirmed that ongoing investment in Extension II plantation will see a further increase in milling capacity to 120.0 FFB MT per hour hour in FY:2020 and to 150.0 FFB MT per hour by 2022.

    The report pointed out that the ongoing growth initiatives and favourable operating environment suggest strong growth in Okomu Oil Palm revenues and overall profitability as cost containment strategy continually delivers slow pace of expansion in costs of sale and operating expenses.

    According to the report, the business connectivity to Benin Electricity Distribution Company (BEDC) has led to significant moderation in Okomu Oil Palm’s operating expenses while its plan to power its plantations’ plants and factories through a steam turbine fed by empty fruit brunches (EFB) would support cost moderation.

    “PRESCO, which has chosen to specialise in the production of speciality fats and oil, RBD and PFAD, enjoys premium pricing on its products. We opine that the company’s profitability has been constrained by the weak capacity of its refinery and fractionalisation plant, which has a capacity of only 100.0 CPO MT/day. Our discussion with management revealed that expansion in the capacity of this plant to 500.0 MT/day would be completed in fourth quarter 2019 and hence presents an upsurge in output and company’s profitability above sector comparable,” Afrinvest stated.

    Presco is also expected to see oil palm trees on about 7,100 hectares, maturing within the forecast period to support the expanded refining capacity. Management of Presco said the sales of CPO will moderate to focus more extensively on sales of RBD and PFAD.

    “For the industry, we opine that there are attractive opportunities presented by current supply deficit within the sector and growing demand suggested by Nigeria’s rising population. We suggest that investors positioning in currently listed companies will offer an opportunity to earn impressive capital appreciation as well as consistent dividend payments.

    “Also, we believe that the industry is accommodative for additional listings by other smaller companies – Real Oil Mills Limited (owned by Flourmills Plc), Grand Cereal & Oil Mills Limited, Poko Oil Mills Limited, PZ Wilmar Limited and BUO Oil Mills (owned by BUA Group) – as well as stable and supportive for long term investments by new companies seeking superior return on investment,” Afrinvest said.

     

     

     

  • Investment One launches multipurpose app

    Investment One Financial Services Limited has launched a multipurpose investment solution for investors, who want to  control their investment affairs. The one-stop application, known as Ziing, is a complete solution package for all classes of investors, who desire to be in control of their investments.

    Group Chief Executive Officer, Investment One Financial Services Limited, Mr. Nicholas Nyamali, who spoke at the launch in Lagos, said the Ziing is a mobile application that essentially enables people to take control of their finances.

    “It is your money buddy. It is an App that provides the user an array of financial services ranging from timely investment information to identifying available investment opportunities,” Nyamali said.

    According to him, with Ziing, people don’t need to walk into a bank to ask their bankers questions on how to manage their idle fund while they can also easily control their expenses in case they are getting out of hands.

    He outlined that a major difference between Ziing and other Apps so far introduced into the Nigerian financial space is that it addresses other financial needs beyond payments.

    “It is a one-stop-shop investment management App.  You can save with it, track what trading looks like on the stock exchange without going through a broker just with a touch on your phone. Ziing can be used for international money transfer, both sending and receiving. For your latest stock prices, treasury bills prices, investment information, simply Ziing it. For cash, loans etc., Ziing it,” Nyamali said.

    Ziing also offers its users access to their investment account outside the working days as it enables them to meet their immediate financial needs at any time they need it. For instance, one can put money in a fixed deposit at 13 per cent and on a Saturday, with phone, one can liquidate such an investment to create immediate access to money. There is no need to have an investment fund or fixed deposit separated from your current account with the Ziing App.

    Speaking on the rationale behind the introduction of the Ziing App by his company in a time like this, Nyamali said, it is the need to provide access and control to players in the financial space both locally and internationally.

    “If we are honest to ourselves we will realise the bulk of solutions we have seen in the banking space are that of payment, payments for subscriptions, bills etc. But the solution for access or control is largely lacking. For instance, l want to access my investments; l want control over my savings; monitor my expenditure; get investment information; investment education; take control of my finances etc.; those  questions had no answers before the introduction of Ziing. That is why at Investment One, we identify that we need a tool called Ziing,” Nyamali said.

    He assured that Investment One is not resting on its oars and the launch of Ziing is just the beginning of the long journey into the future.

     

     

    “There is a future we see, it is a future when you will be able to take control of your money.  For us in investment one this is the beginning of the transit. Ziing is one the things that Investment One is offering the financial industry which will help people take charge of their investment”, Nyamali said.

     

  • NSE, Afrinvest launch new equity indices

    The Nigerian Stock Exchange (NSE) and Afrinvest Securities Limited have launched two factor indices to provide investors with additional benchmarks to track portfolio performance.

    NSE-Afrinvest Banking Value Index (NSE-Afr BVI) and NSE-Afrinvest High Dividend Yield Index (NSE-Afr HDYI) were launched on Monday.

    NSE-Afr BVI and NSE-Afr HDYI were designed in response to requests for applicable benchmarks for measuring value in banking stocks and high dividend stocks listed on the Exchange. They will serve as tools for investment managers and corporate treasuries seeking appropriate benchmarks to evaluate the performance of their portfolios to a segment of the banking sector or high dividend orientation as applicable. The indices can also be used as the performance target in index-replicating financial products such as Exchange Traded Funds and derivatives.

    Chief Executive Officer, Nigerian Stock Exchange (NSE), Mr. Oscar Onyema stated that the two new indices were due to rising demand for financial products that adequately meet the needs of market participants.

    He said the indices consider the fundamentals of underlying securities and commended Afrinvest for its product innovation and for leveraging the Exchange’s index calculation and management expertise.

    “The Exchange is committed to driving sustainability of our marketplace and supporting investable product creation endeavours by stakeholders to enhance the depth of the market. We will continue to welcome innovative solutions to identifiable gaps in the capital market,” Onyema said.

    Group Managing Director, Afrinvest West Africa, Mr. Ike Chioke  said the new will serve as a veritable proponent for more forward-thinking initiatives meeting market needs.

    According to him, on the back of these indices, investors will now enjoy the benefits of proxies that seek out dividend-paying stocks and value-oriented banking stocks listed in Nigeria.

    The NSE-Afr BVI and the NSE-Afr HDYI as with all other NSE indices will align with the NSE’s Index committee’s governance standards.

     

  • Guinness allays fears over fire

    Guinness Nigeria Plc has assured the investing public that the weekend’s fire incident at its Aba premises will not have any material impact on its earnings.

    Company Secretary and Legal Director, Guinness Nigeria Plc, Rotimi Odusola, in a statement to the investing public, stated that the January 18, 2019 fire at the brewer’s Aba premises was swiftly contained and put under control by the Aba Fire Services, with assistance from neighbouring companies.

    He noted that the Aba premises, located in the Osisioma Industrial Layout, currently serves as a logistics centre with few personnel on site as major production operations take place in the company’s Benin, Edo State and Ogba, Lagos State, breweries.

    According to him, there was no injury or major material loss resulting from the fire incident as it was contained outdoors and did not affect any of the buildings on site.

    “While awaiting the outcome of an assessment of the incident, we do not expect any material impact to our numbers,” Odusola stated.

    He said the company is investigating the cause of the fire, assuring that Guinness Nigeria is committed to ensuring the health and safety of its employees and the communities where it operates.

     

     

  • Fidelity bond: SEC gives operators deadline

    The Securities and Exchange Commission (SEC) has directed all capital market operators to ensure they submit their updated fidelity bond on or before January 31.

    A fidelity bond is essentially a form of insurance against internal fraud, malpractices and willful professional negligence. It provides cushion for various losses that might arise from employee’s dishonesty.

    In a circular to all capital market operators, SEC noted that by virtue of Rule 27 (1) of SEC Rules and Regulations, which was made pursuant to the Investments and Securities Act, 2007, every registered capital market operator is required to provide and maintain a bond or professional indemnity insurance policy.

    “In view of the foregoing, all registered capital market operators who have not updated their fidelity bond for the year 2019 are required to do so on or before January 31, 2019. All fidelity bonds submitted to the commission shall cover the period between January 1, 2019 and December 31, 2019,” SEC stated.

    The commission warned that failure to comply with the deadline would attract penalty as stipulated in extant rules and regulations.  Operators with deficient fidelity bond might not be allowed by SEC to handle transactions.

    SEC had in 2013 adopted the annual Gregorian calendar as duration for each fidelity bond. The change came on the heels of an exclusive report by The Nation that some 213 capital market operators including several high-brow law firms, reporting accountants, banks, investment management firms and advisory firms were operating with expired fidelity bond.

    The expiration of fidelity bonds makes the functional registration of the companies and individuals as capital market operators incomplete.

     

     

  • Stock Exchange reviews free float’s listing requirement

    Nigerian Stock Exchange (NSE) authorities have launched a review of the market’s free float requirement, one of the stock market’s main listing requirements.

    The review comes on the heels of exclusive report by The Nation that several quoted companies had failed to meet the free float requirement.

    Free float, otherwise known as public float, refers to the number of shares of a quoted company held by ordinary shareholders other than those directly or indirectly held by its parent, subsidiary or associate companies or any subsidiaries or associates of its parent company; its directors who are holding office as directors of the entity and their close family members and any single individual or institutional shareholder holding a statutorily significant stake, which is five per cent and above in Nigeria.

    Thus, free float’s shares do not include shares held directly or indirectly by any officer, director, controlling shareholder or other concentrated, affiliated or family holdings.

    NSE Chief Executive Officer, Mr Oscar Onyema, said the Exchange was reconsidering the free float requirement for companies quoted on its main board with a view to providing a two-option requirement that should make compliance easier for the companies.

    According to him, the review is expected to provide two alternatives of percentage number of shares or actual value of market capitalisation for companies on the main board, similar to the provisions on the premium board. All the existing defaulters are listed on the main board, where more than 95 per cent of quoted companies are listed.

    Under the existing rules, companies listed on the premium board are required to have 20 per cent free float or more than N40 billion of their capitalisation in the hands of general investing public. Companies on the main board are required to have a minimum free float of 20 per cent of their market capitalisation, implying that 20 per cent of the companies’ shareholdings must be available for minority retail shareholders. However, companies on the Alternative Securities Market (ASeM) are required to have 15 per cent free float.

    Onyema said actual value would also be determined as alternative free float for the main board, noting that free float requirement is an important part of the stock market.

    Stock markets maintain minimum public float to prevent undue concentration of securities in the hands of the core investors and related interests, a situation that can make the stock to be susceptible to price manipulation. Besides, it provides the general investing public with opportunity to reasonably partake in the wealth creation by private enterprises.

    The Nation had reported that 18 quoted companies have less-than-required minimum volume of shares for public trading, a major infraction that may adversely affect liquidity and efficient price discovery on the companies.

    The overconcentration easily makes the companies’ share prices susceptible to manipulation and detracts from stock market’s objectives of wealth distribution, liquidity and efficient pricing.

    According to the report, the defaulting companies included Union Bank of Nigeria, which currently has a free float of 14.94 per cent; Capital Hotel, 2.99 per cent; Great Nigerian Insurance, 16.0 per cent; AG Leventis, 11.64 per cent; Interlinked Technology, 14.50 per cent; Infinity Trust Mortgage, 3.50 per cent; Transcorp Hotels, six per cent; Ekocorp, 11.84 per cent; Champion Breweries, 17.17 per cent; Caverton Offshore Support Group, 17.30 per cent; The Tourist Company of Nigeria Plc, 3.58 per cent and e-Tranzact International Plc, which has a free float of 10.06 per cent.

    Others were Aluminium Extrusion, 17.73 per cent; Union Dicon Salt, 18.0 per cent; Austin Laz & Company, 5.51 per cent; CWG, 15.97 per cent; Global Spectrum Energy Services, 7.01 per cent and Portland Paints & Product Nigeria (PPPN), which has a free float of 14.57 per cent, 5.43 percentage points below the 20 per cent minimum requirement.

    Authorities at the Exchange have already tagged the companies with a red alert of non-conformity with the requisite listing and corporate governance requirements. With the “Below Listing Standard (BLS) tag, the deficient companies would have to undertake capital restructuring to reduce the overconcentration and free more shares for the general retail investing public.

    Alternatively, deficient companies may opt to move from the main board to the ASeM or in the extreme cases, opt to delist their shares from the Exchange. Chellarams, which had been quoted on the main board migrated to the ASeM to cure its free float deficiency. Two companies-Great Nigeria Insurance and Tourist Company of Nigeria have also applied for voluntary delisting of their shares.

    The report indicated that many of the deficient companies have been given up till 2020 to restructure their share capital and comply with the minimum free float. Failure by deficient companies to restructure their share capital at the expiration of the deadline or secure extension of the deadline may lead to delisting of their shares from the NSE.

    Free float deadline is usually in deference to application by the management of a company for some period to comply with the free float. However, the company is required to provide quarterly disclosure report to the NSE on the efforts being made to fully comply with the deadline.

    By the expiration of the deadline, a company is mandatorily required to have completed partial divestments or dilution of the ‘non-public’ shareholdings to free  the required percentage of equity stake for public holding, unless the management of the NSE grants fresh waivers and extensions for the companies. In the extreme instance, a company with deficient public float may opt to delist its shares.

  • NSE begins final stages of demutualisation

    The Nigerian Stock Exchange (NSE) has started working on the final stages of its conversion from a not-for-profit limited by guarantee entity into a profit-making, shareholders-owned public limited liability company. The conversion is technically known as demutualisation.

    NSE Chief Executive Officer, Mr Oscar Onyema, confirmed that the Demutualisation Act, which was signed into law by President Muhammadu Buhari, has been gazzetted and forms the legal background for the demutualisation process.

    According to him, the Exchange has gone farther than it had ever been in the conversion process and has started working on the final stages of the process.

    He said the Exchange was committed, not only to early completion of the process, but to ensure that the conversion enhances its success story.

    While the NSE was initially incorporated under the Companies Ordinance of 1958 on September 15, 1960 as a private company limited by guarantee with a share capital, it was re-registered as a company limited by guarantee without a share capital in 1990 upon the enactment of the Companies & Allied Matters Act, Cap C20, 2004, (CAMA), which replaced the Companies Ordinance (1958). CAMA had required all companies limited by guarantee that had a share capital to be converted to companies limited by guarantee without share capital, thus the Exchange’s Memorandum of Association was duly altered and the NSE has since been a not-for-profit corporate legal entity without a shareholding structure.

    The demutualisation process was launched in 2002 with the approval-in-principle of the conversion by the council of the Exchange. Members of the Exchange in March 2017 passed crucial resolutions that authorised the council and management to proceed with the process leading up to the demutualisation of the Exchange.

    The members of the Exchange also ratified and approved the engagement of financial advisers, legal advisers, tax advisers and any other adviser that may be required for the demutualisation while mandating the council and management “to do all such things and exercise all such powers as may be necessary or incidental to achieving the objective” of demutualisation, subject to applicable laws and regulations and obtaining the approvals of members and the relevant regulatory authorities.

    Out of the 27 African Stock Exchanges under the aegis of African Securities Exchanges Association (ASEA), seven stock exchanges including Johannesburg, Nairobi, Mauritius, Seychelles, Rwandan, Casablanca stock exchanges and BRVM have been demutualised.

    Academic research on the effect of demutualisation on the financial performance of 20 demutualised exchanges between 1996 and 2008, suggested that the return on equity increased by an average five per cent to 20 per cent, with the average net profit margin increasing by 14 per cent to 30 per cent.

    Demutualisation has also contributed positively to stock market performance. On the back of strong macro-economic performance, improved regulation and other factors, the Johannesburg Stock Exchange (JSE) All Share Index has grown by 280 per cent since its demutualisation in 2005 to reach 53,817.31 points as at the end of April 2017. Following demutualisation, a number of stock exchanges had re-positioned their markets, building alliances or consolidating within and across borders in order to enhance their attractiveness. For example, in 2006, the Australian Stock Exchange merged with the Sydney Futures Exchange to form the Australian Securities Exchange (ASX). In 2007, the New York Stock Exchange (NYSE) merged with Euronext to form NYSE Euronext, creating the world’s largest stock exchange with revenues of $4.5 billion.

    The approved rules on demutualisation by Securities and Exchange Commission (SEC) simply defined demutualisation as “the process through which a member owned organisation becomes a shareholder owned company”. The demutualisation framework approved by SEC stresses that the process of demutualisation of the Securities Exchange should include an exchange of membership rights in the Securities Exchange for ownership of shares in the demutualised Securities Exchange.

    According to an informed source on the demutualisation process, after valuation of the Exchange, determination of members who are qualified for shareholdings and the appropriate number of shares receivable by each member, the primary allotment of shares would be done to current members of the Exchange, thus formally converting the Exchange from its current members-owned status to shareholders-owned status.

    The SEC’s rules on demutualisation allow the Exchange to give equity interest to a strategic investor subject to establishment of the facts that the strategic investor has technical expertise through previous experience in managing other Exchanges and the aggregate number of shares to be offered to the strategic investors shall not be more than 30 per cent of issued and fully paid up capital of the securities exchange.

    However, if the Exchange is in dire need of funds, it could issue a higher number of shares subject to approval of the Commission.

    The rules indicate that stockbrokers, who constitute the largest members of the NSE, may have to sell down their shareholdings within a period of five years in the demutualised Exchange.

    The rules indicated that the aggregate equity interests of members of any specific stakeholder group such as stockbrokers and broker-dealer in the demutualised securities exchange should not exceed 20 per cent.

    The rules also retained the provision that no individual or entity must directly or in directly own more than five per cent of the issued shares or voting rights in a demutualised securities exchange.

    The rules, made pursuant to Section 313 of the Investments and Securities Act (ISA) 2007, describe “related entities and persons” as a person or entity that is related to the entity or person that owns the equity or the voting rights.

    The rules stipulate that the securities exchange should initiate a process for determining the accurate list of members of the Exchange prior to the commencement of demutualisation.

    “The stakeholder groups, who are shareholders of the Securities Exchange, shall with effect from the date of demutualisation, shall reduce their cumulative shareholding in the demutualised Securities Exchange to no more  than 20 per cent within five years,” according to the rules.

    As part of preconditions for demutualisation, a securities exchange shall, prior to demutualisation, submit the names and profiles of members of its committee on demutualisation, a valuation report, the draft Memorandum and Articles of Association of the Securities Exchange, the proposed rules of the demutualised Securities Exchange, the proposed allotment and the basis of the proposed allotment of shares to the initial shareholders of the Securities Exchange, a list of the directors proposed as the Board of the Securities Exchange, an implementation plan stating the process to be adopted for effecting the demutualisation of the Exchange, including but not limited to the treatment of the rights and liabilities of the existing members of the Exchange and the proposed plan for the independent management of the commercial and regulatory functions of the demutualised Securities Exchange and timelines for implementation of necessary structures to ensure the functional treatment of commercial and regulatory functions for a “No Objection” clearance by SEC.

     

     

  • C & I Leasing cancels 1.48b shares

    C& I Leasing Plc has concluded a massive share reconstruction involving cancellation of 1.479 billion ordinary shares of 50 kobo  each, about 79 per cent of the company’s pre-consolidation issued share capital.

    The share capital reconstruction reduced the leasing company’s outstanding shares from 1.883 billion ordinary shares of 50 kobo each to new total outstanding ordinary shares of 404.25 million ordinary shares of 50 Kobo each.

    C & I Leasing has notified the Exchange that the reconstruction exercise has been completed and the shareholders’ register updated accordingly. With the completion of the share consolidation, the full suspension placed on trading in the shares of C & I Leasing was lifted and trading resumed on the shares of the company on  January 14, 2019.

    Under the share consolidation, four ordinary shares of 50 kobo each were consolidated into one ordinary share of 50 kobo each. The qualification date for the share reconstruction was December 12, 2018. All existing C & I Leasing shares certificates became null and void on the qualification date and new share certificates in C & I Leasing were issued to those shareholders whose names appear on the company’s register of members as at the close of business on the qualification date as approved by the court in the ratio of one ordinary share for every four ordinary shares previously held.

    According to the company, the purpose of the reconstruction was to allow the company have enough unissued shares to accommodate the conversion of the Abraaj loan stock to ordinary shares and to raise additional capital through the capital market for business expansion.

    AbraaJ Investment Management Limited (AIML) has indicated its intention to convert its $10 million loan in C & I Leasing to equities in the Nigerian leasing company. The proposed conversion followed the 2018 maturity of the $10 million unsecured, coupon redeemable, convertible loan stock in C & I Leasing.

    C & I Leasing stated that representatives of Abraaj, managers of the Aureos Africa Fund, confirmed their intention to convert the loan stock to equity at a board of directors’ meeting of C & I Leasing in December 2018.

    Managing Director, C & I Leasing Plc, Mr. Andrew Otike-Odibi, said the proposed debt-to-equity deal would be a positive deal for the company as it improves the capital structure of the company and helps position it favourably for additional capital raise from the market in first quarter 2019.