The Nation Newspaper

Tag: IPO

  • Transcorp Hotels plans N8b IPO, eyes listing

    Transcorp Hotels Plc, the owners of the prestigious Transcorp Hiltons Hotel, Abuja, plans to float an initial public offering of N8 billion and subsequently list its shares as a separate entity on the Nigerian Stock Exchange (NSE), according to sources in the know of the plan.

    Transcorp Hotels Plc is a subsidiary of Transnational Corporation of Nigeria (Transcorp) Plc, a quoted conglomerate with interests in agriculture, hotel and tourism, oil and gas and power. Transcorp’s share price rose by 5.41 per cent on Monday at the NSE to close at N6.43 per share.

    According to the plan, Transcorp Hotels would issue 800 million ordinary shares of 50 kobo each at a price of N10 per share, pricing its IPO higher than the market value of its parent company.

    Transcorp holds 88 per cent majority equity stake in Transcorp Hotels through Capital Leisure and Hospitality Limited. The remaining 12 per cent is owned by the Federal Government of Nigeria.

    The net proceeds of the IPO, according to sources, would be used to finance the expansion plan of the hotel and tourism company as well as support its balance sheet.

    Transcorp had recently signed a new deal with Hilton Worldwide to build a new premier hotel in the up-market suburb of Ikoyi, Lagos.

    The proposed Transcorp Hilton Lagos, a full service, 350-room hotel on Glover Road, Ikoyi, will be the Hilton Group’s second hotel in Nigeria by Transcorp, following the award-winning Transcorp Hilton Hotel Abuja, which is one of the leaders in Hilton’s global network. The new hotel will be jointly owned by Transnational Hotels and Tourism Services Ltd, a hospitality subsidiary of Transcorp and Tony Elumelu’s Heirs Holdings. Heirs Holdings holds the majority stake in Transcorp.

    Speaking at the official signing of the management contract at Heirs Holdings’ office in Lagos, Chairman, Heirs Holdings, Mr. Tony Elumelu said the agreement marked another milestone in the long-standing partnership with Hilton Worldwide.

    According to him, the Ikoyi development, along with the extensive refurbishment and upgrade of the group’s existing hotels in Calabar and Abuja, demonstrates Heirs Holdings’ commitment to driving growth in real estate and hospitality, a strategic sector for Nigeria’s economic development.

    “The new Transcorp Hilton Lagos will not only present an additional world-class venue for the increasing numbers of investors, businessmen and tourists to Nigeria, but is creating much-needed jobs for our citizens, enabling their social and economic development,” Elumelu said.

    Transcorp plans to draw on the growing profiles of its subsidiaries to consolidate its improving fundamentals. Interim report and accounts of Transcorp for the six-month period ended June 30, 2014 had shown that turnover rose by 177 per cent while group operating profit and pre-tax profit jumped by 145 per cent and 122 per cent respectively.

    The report showed that turnover doubled to N21.2 billion in June 2014 as against N7.67 billion recorded in comparable period of 2013. Gross profit rose from N5.99 billion in first half 2013 to N14.96 billion in first half 2014. Operating profit for half year 2014 was N9.75 billion as against N3.99 billion in comparable period of 2013. Group profit before tax doubled to N8.02 billion in 2014 compared with N3.61 billion in corresponding period of 2013. After taxes, net profit rose from N2.48 billion in 2013 to N6.89 billion in 2014.

    The improved bottom-line underlined stronger returns with earnings per share rising from 5.53 kobo to 11.30 kobo. Transcorp paid a dividend per share of 5.0 kobo for the 2013 business year, its first dividend since inception.

    Elumelu had noted that the principal cause of asset growth for the group and company was its acquisition of the Ugheli Power Plant, Nigeria’s largest generating facility and where its influence has already seen a doubling of capacity.

    “I believe that we will build on the solid foundation laid over the last couple of years to begin an era of steady and increasing dividend payment to our shareholders,” Elumelu said.

    He noted that following Transcorp’s takeover of the Ugheli power plant, power output has more than doubled at the plant from 160 megawatts on handover date to 360 megawatts currently pointing out that the goal of the new board is to increase output at the plant to 700 megawatts by December 2014 by embarking on an extensive rehabilitation programme.

  • Cynthia: ‘Suspects committed similar offences in two hotels’

    Cynthia: ‘Suspects committed similar offences in two hotels’

    •Lagos tenders graphic evidence

    A Lagos High Court, Igbosere, was yesterday told that the suspected killers of Cynthia Osokogu had committed similar offences in two other hotels in Festac.

    A prosecution witness, Joseph Edo, the Investigating Police Officer (IPO), during cross-examination in the trial of four suspected killers of the deceased, said the other two offences were committed at Chelsea Suit and Penny Hotel by Okumo Nwabufo and Olisaeloka Ejike (first and second defendants).

    The other two defendants in the trial are the pharmacist who allegedly sold the drug used to drug the deceased, Orji Osita, and brother to the second defendant, who allegedly sold Cynthia’s stolen phone, Nonso Ezike.

    Explaining why the other cases were not included in the trial, Edo said the incidents did not happen on the same day, adding: “It was based on the confessional statement by the 1st and 2nd defendants that they carried out similar acts in other hotels in Festac.”

    He said investigations into the other two cases were ongoing, adding that the fourth defendant (Nonso) received stolen phones on three occasions from the first and second defendants.

    “The fourth defendant took me to Ladipo market where he stole somebody’s receipt which he used in selling the deceased’s phone to someone in Port Harcourt and the person was arrested. He bought the phone for N30,000 and sold for N40,000. He also knows that his elder brother does not deal in phone. He confessed that he gave the locked phone to a repairer who flashed it for him,” Edo said.

    Similarly, the state government tendered a laptop containing graphic evidence on how Cynthia was murdered.

    The laptop, which allegedly belongs to Nwabufo, according to another prosecution witness, Sergeant John Babalola, was retrieved from the defendant after he confessed to downloading gory pictures of the deceased from his Blackberry phone into his laptop.

    Among the pictures presented before Justice Olabisi Akinlade was a close shot of the deceased’s private part; one showing the deceased cellotaped and another showing the late Cynthia’s international passport placed on her chest.

    Led in evidence by the state Attorney General and Commissioner for Justice, Ade Ipaye, Babalola told the court that Nwabufo was told to make a further statement after the said pictures were discovered in his laptop in his house.

    “After we discovered the pictures, Area Commander Dan Okoro asked that additional statements be made. The statement was signed by the first defendant. When the first defendant was arrested, he confessed that he knew what he did and that everything was over.

    “He sent the pictures to his laptop through his Blackberry phone. The first defendant operated the Blackberry phone to show us (police) the chain used in tying the deceased. The owner of the phone is the first defendant,” said Babalola.

    Continuing, the witness said on August 20, 2012, the first defendant was arrested and his statement was taken.

    “Based on his confessional statement, me and my team followed him to his home in Festac and recovered the said laptop, phones and various network SIM cards.

    “On that same date, the first defendant was asked to open the laptop, which he carried by himself to the Area Commander’s office. I and one ASP Marian were there and we saw the picture of the deceased lying down and her international passport lying on her chest.”

    After listening to the testimonies of the witness and admitting the laptop as exhibit, Justice Akinlade adjourned the case till June 27 and 30 for continuation, following the prosecution’s argument that they would operate Nwabufo’s phone before the defence counsels.

    Osokogu, who was murdered in Cosmilla Hotels in Festac on July 22, 2012, was said to have met her alleged killers on Facebook.

    She was lured to Lagos, where she was allegedly chained, raped, and drugged and strangled by Nwabufo and Ezike.

    They also allegedly stole three Blackberry phones valued at N150,000; jewellery, an international passport and a driver’s licence, belonging to the deceased.

  • NSE looks for first IPO for primary market

    The Nigerian Stock Exchange (NSE) is looking for a major initial public offering (IPO) that will signal the beginning of recovery at the primary market.

    Chief Executive Officer, Nigerian Stock Exchange (NSE), Mr Oscar Onyema, said the floatation of an IPO by one of the prospective issuers would send a message about the full recovery of the capital market, with the resume of activities at the primary market complementing robust recovery at the secondary market.

    He said NSE has engaged several quotable companies for the benefits of listing their shares on the stock market, adding that there were prospects for new listings in the period ahead.

    The Nation’s investigation had earlier shown that many companies that had shelved plans to raise new capital from the capital market due to the lingered recession have restarted discussions about prospects of accessing new equity funds from the market.

    Investment banking sources said there were indications of renewed interests in the new issue market following sustained recovery in the stock market, which has seen considerable restoration of equities’values and investors’confidence in recent period.

    They indicated that ongoing discussions could lead to making a debut of early new issues in the market around the first half of 2013 if the market sustained its ongoing recovery.

    Market sources said though the talks were still not definitive, the discussions pointed to imminent rebound of the new issue market.

    From a whooping N1.3 trillion in 2007, the recession that started in 2008 had withered enthusiasms for new issues, especially equities, as new issues dropped to about N86 billion in 2009. It has since declined consecutively with the few new equity issues in recent years largely rights issues motivated by large core investors seeking to recapitalise their companies.

    Companies were, however, said to be considering that the positive sentiments from the secondary market recovery would impact on new equity issues.

    Reports by boards of directors of several companies had indicated that firms were constrained by their inability to source new equity capital due to the melt down at the capital market while recourse to high-interest bank loans depressed probable returns to shareholders.

    Reports by quoted companies highlighted the twin-problem of high cost of fund and liquidity squeeze on corporate earnings.

    Several companies had earlier indicated plans for supplementary equity issues and initial public offering (IPO) but suspended the plans due to what they described as unfavourable situation at the primary market.

    Not less than 11 companies had earlier indicated interests in raising new equity funds. These included companies such as Cement Company of Northern Nigeria (CCNN), May and Baker Nigeria, Fidson Healthcare, RT Briscoe, DN Meyer, Nigerian Aviation Handling Company (Nahco), Lafarge Wapco Cement Nigeria Plc and UACN Property Development Company (UPDC) Plc.

    Two prospective new listings – Promasidor Nigeria Limited and Notore Chemical Industries Limited – had also mulled plans to float IPOs.

    Many banks were said to be considering proactive fund-raising plans to boost their lending capacity and forestall adverse impact from global and domestic regulatory changes.

    Many banks have subsisting shareholders’ resolutions to raise new funds through equity and debt issues.

    Most of the companies had already intimated shareholders of the necessity of accessing new funds while many have started and completed some key steps in the new issue process.

    While some of the companies plan to use net proceeds of their offers for business expansion, most of the companies would use the funds to restructure their balance sheets by reducing bank loans and providing additional working capital to support long-term growth.

    Already, CCNN had secured shareholders’approval to raise N45 billion.The company had received approval to raise N15 billion each through rights issue, public offer and a rights-based secured convertible debenture issue.

    This implied that the company would be seeking to raise up to N30 billion from existing shareholders while new investors and existing shareholders would contribute N15 billion.A secured convertible debenture would give opportunity to debenture holders to choose to convert their holdings to ordinary shares at a later date.

    Notore plans to raise more than N160 billion.The net proceeds from the IPO would be used to finance a brand new fertiliser plant, with a conservative estimated cost of $1 billion. The new fertiliser plant was part of the company’s expansion programme, which aimed to build new capacity to support the current attainable capacity of the existing plant of 750,000 metric tonnes.

    CCNN was planning to raise funds to finance expansion while Promasidor plans to use net proceeds of its IPOs to partly finance its new factory.