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Tag: UACN

  • UACN outlines strategic growth plan as shareholders get N1.9b dividend

    The board and management of UAC of Nigeria (UACN) Plc have outlined strategic initiatives aimed at addressing the root causes of the group’s historical declining performance and drive growth in the years ahead.

    Chairman, UAC of Nigeria (UACN) Plc, Mr. Dan Agbor, told shareholders yesterday at the annual general meeting in Lagos that the company would use the current business year as a transitional year to further implement initiatives that will stem decline and drive future profitable growth.

    According to him, specific area of focus will be on capital allocation and portfolio composition, human capital, operating company strategy and most importantly, reinforcing a group-wide culture of accountability and responsibility.

    He added that the group will also seek to better link employee compensation to the creation of long term shareholder value.

    “I am excited by the challenges as well as by the opportunities that lie ahead, and  I assure you that your board and the management of your company are well equipped to meet these challenges and take advantage of the opportunities in the Nigerian economy generally and in our existing businesses more specifically,” Agbor said.

    He said the group has decided to wind up the Warm Spring Waters Nigeria limited due to weak operational performance as earlier approved by shareholders, noting that the management is currently conducting a detailed review of its business strategy to enhance value creation.

    He commended the shareholders on the success of the company’s recent rights issue which was oversubscribed; pointing out that the 104.5 per cent subscription level reflected shareholders’ strong confidence in the company.

    He said the net proceeds of the rights issue are already being applied for the intended purposes and will ultimately improve shareholders value.

    Shareholders approved distribution of N1.86 billion as cash dividend for the 2017 business year, representing dividend per share of 64.58 kobo.

    UACN recorded a top line growth of eight per cent from N82.6 billion in 2016 to N89.1 billion in 2017. Profit after tax declined sharply from N5.6 billion to N963 million in 2017, reflecting the compression in the margins of operating subsidiaries.

  • New core investors get board appointment at UACN

    The founder and another nominee of an investment firm that recently emerged as the single largest shareholder in UAC of Nigeria (UACN) have been appointed as a non-executive director on the board of Nigeria’s oldest surviving business and largest conglomerate.

    The board of directors of UACN appointed Mr. Folasope Aiyesimoju, the founder of Themis Capital Management, as a non-executive director. Themis Capital Management recently emerged as the largest single shareholder in UACN with 8.0 per cent equity stake consisting of 232.35 million ordinary shares of 50 kobo each. Another nominee of Themis Capital Management, Mrs Olufunke Ighodaro was also appointed as a non-executive director.  A co-founder of Themis Capital Management, Mr. Peter Mombaur,will serve as alternate director to the duo of Aiyesimoju and Ighodaro.

    Three major shareholders had emerged with more than five per cent equity stake in UACN after the conglomerate concluded its recent N15.36 billion rights issue. A regulatory filing signed by Company Secretary, UAC of Nigeria Plc, Mr. Godwin Samuel, indicated the major shareholders of the conglomerate to now include Stanbic IBTC Nominees, with 8.0 per cent equity stake consisting of 225.23 million ordinary shares of 50 kobo each; Blakeney GP 111 Ltd, with 6.0 per cent equity stake consisting of 165.79 ordinary shares of 50 kobo each and Themis Capital Management, with 8.0 per cent consisting of 232.35 million ordinary shares of 50 kobo each.

    UACN had floated a rights issue to raise N15.36 billion by offering 960.43 million ordinary shares of 50 kobo each at N16 per share to pre-qualified shareholders. The new shares were pre-allotted to shareholders on the basis of one new share for every two shares held as at the close of business on Thursday October 19, 2017. The application list for the rights issue had opened on November 15, 2017.

    At the period of the rights issue, UACN was owned by some 185,000 shareholders and no shareholder held five per cent and above other than Stanbic Nominees Nigeria, which held 17.86 per cent equity stake.

    Market sources said the two new major shareholders might have purchased renounced rights by Stanbic IBTC Nominees, which diluted the latter’s shareholding and spread the major shareholdings across three separate entities.

    The Nation’s check indicated that UACN has current total outstanding shareholdings of 2.881 billion ordinary shares. With this, Stanbic IBTC Nominees holds 7.82 per cent equity stake, Blakeney GP 111 Ltd holds 5.75 per cent equity stake while Themis Capital Management holds the highest equity stake of 8.06 per cent.

    Samuel confirmed the appointment of Aiyesimoju and another non-executive director, Mrs Olufunke Ighodaro.

     

  • UACN to raise N20b for real estate unit

    Nigerian conglomerate UAC plans to raise N20 billion ($65.4 million) this year through a bond sale to refinance short-term borrowings at its real estate subsidiary, where losses have widened, group CEO Abdul Bello said yesterday.

    Bello said the company would restructure its real estate unit UPDC, which is suffering from a current oversupply in the market coupled with a drop in Nigerians’ purchasing power.

    Nigeria has just emerged from its worst recession in a quarter of a century while consumers are struggling with double-digit inflation.

    Bello told an analysts’ call that the harsh economic conditions were still affecting the housing market and that sales at UPDC fell 20 per cent in 2017.

    UPDC reported on Wednesday that its losses widened to N3.05 billion in 2017 from N1.23 billion the previous year. The group reported a pretax profit of N3.25 billion for 2017, but this was down 61 percent.

    “We would use 2018 to refinance a short-term facility. We intend to have this business restructured. We see long-term growth supported by a huge housing deficit,” Bello, who took over as chief executive this year, said.

    Nigeria, home to more than 180 million people, suffers from long-term a housing shortage. Few banks offer long-term mortgages as high interest rates make them unattractive for buyers while lenders worry about the default risk.

    Officials have said Nigeria needs to build around 17 million houses annually to catch up with a fast-growing population which is set to more than double to 400 million in 2050, according to United Nations (UN) estimates. Nigeria will be then the third most populous nation after China and India.

    UPDC cut its debt to N19.3 billion in 2017, down 15 per cent from the previous year.

    Shares in UAC, which has interests in foods, logistics and livestock feeds, rose 0.58 per cent yesterday to N17.30 while UPDC traded flat at N3 naira.

  • UACN lists 960.4m rights shares

    UAC of Nigeria (UACN) Plc at the weekend listed a total of 960.43 million ordinary shares of 50 kobo each, adding about N16.4 billion to the market capitalisation of the conglomerate. The supplementary shares resulted from the recent rights issue of UACN, which was fully subscribed.

    With the new listing, UACN-Nigeria’s oldest surviving business now has market capitalisation of N49.12 billion and issued share capital of 2.88 billion ordinary shares of 50 kobo each. UACN’s share price closed weekend at N17.05 per share.

    The Nation had exclusively reported that the 960.43 million shares rights issue was fully subscribed.  UACN had floated a rights issue to raise N15.36 billion by offering 960.43 million ordinary shares of 50 kobo each at N16 per share to pre-qualified shareholders. The new shares were pre-allotted to shareholders on the basis of one new share for every two shares held as at the close of business on Thursday October 19, 2017. The application list for the rights issue had opened on November 15, 2017 and closed on Friday December 22, 2017.

    At the period of the rights issue, UACN was owned by some 185,000 shareholders and no shareholder held five per cent and above other than Stanbic Nominees Nigeria, which held 17.86 per cent equity stake.

    The conglomerate has however confirmed that three major shareholders now own more than five per cent equity stake.

    In a regulatory filing, UACN confirmed that three shareholders hold more than five per cent of its shares. Extant rules require a company to inform capital market authorities of shareholders with five per cent and above shareholdings and to clearly state that in its annual report.

    According to the filing signed by Company Secretary, UAC of Nigeria Plc, Mr. Godwin Samuel, major shareholders of the conglomerate now include Stanbic IBTC Nominees, with 8.0 per cent equity stake consisting of 225.23 million ordinary shares of 50 kobo each; Blakeney GP 111 Ltd, with 6.0 per cent equity stake consisting of 165.79 ordinary shares of 50 kobo each and Themis Capital Management, with 8.0 per cent consisting of 232.35 million ordinary shares of 50 kobo each.

    Nigeria’s oldest surviving business, UACN started business in Nigeria in 1879, well ahead of the 1914 amalgamation that created the current Nigerian nation. With 10 subsidiaries in key sectors of the Nigerian economy, the UACN Group consists of several active companies spreading through manufacturing, services, logistics and real estate sectors of the Nigerian economy. These include four quoted subsidiaries-CAP Plc, UACN Property Development Company (UPDC) Plc, Livestock Feeds and Portland Paints and Products Nigeria Plc; in addition to the parent company, UACN, which was listed in 1974. UPDC Real Estate Investment Trust, which is also quoted on the NSE, is a subsidiary of UPDC.

    UACN acquired Livestock Feeds and Portland Paints in 2013. Other members of the group included UAC Foods Limited, UAC Restau

  • UACN appoints five new MDs, DMD

    Nigeria’s largest conglomerate and oldest surviving business, UAC of Nigeria (UACN) Plc has appointed four new managing directors and a deputy managing director for five of its subsidiaries.

    In a group-wide management changes, the conglomerate has appointed new heads for its paints and chemical, logistics and agricultural businesses. Mrs Oluwakemi Ogunnubi takes over as Managing Director, Chemical and Allied Products (CAP ). Mr. Taiwo Ajibola is the new Managing Director, MDS Logistics Limited. Mr. Adedamola Olusunmade has assumed office as Managing Director of Portland Paints & Products Nigeria Plc while Mr. Solomon Aigbavboa, previously Managing Director of MDS Logistics Limited, has been appointed Managing Director of Livestock Feeds Plc.

    Mr. Mukhtar Yakasai, former Managing Director of Portland Paints and Products Nigeria is now the Deputy Managing Director of Grand Cereals Limited, a Jos-based agricultural subsidiary of the group. Mrs. Modupe Asanmo, erstwhile Managing Director of Livestock Feeds has retired from the company after 10 years of service. All the appointments took effect from January 1, 2018.

    Ogunnubi, a Chartered Accountant (ACA), attended The Polytechnic, Ibadan where she obtained a Higher National Diploma (HND) in Accountancy in 1992.  Until her appointment, she was the Head, Financial Services of UACN. She is an alumnus of Ashridge Business School and a member of the Institute of Risk Management, United Kingdom (UK).

    Olusunmade, a graduate of Chemical Engineering from the University of Benin started his career as an Assistant Production Manager with CAP in 1999. He worked in different capacities including plant manager, marketing manager, corporate responsibility and strategy manager and technical operations manager. He has attended local and international training courses including the Lagos Business School’s Advance Management Programme and was in 2007 appointed to the International Labour Organisation’s Committee of Experts on Safe Handling of Hazardous Chemicals.

    Yakasai is a graduate of Agriculture with Agricultural Economics option from Ahmadu Bello University Zaria and holds an MBA from the same University.  He joined CAP in July 1985 and held various roles as National Sales Coordinator, Business Manager Flame Guard and CAP Decorators, General Manager Business Development and General Manager Paints. He was at various times the Managing Director of Spring Waters Nigeria Limited (SWAN) and Warm Spring Waters Nigeria Limited (Gossy) and Special Projects Manager, UAC. He was appointed to the Board of Portland Paints in June 2013 as a Non-Executive Director and, subsequently, Managing Director of the company in October 2015. Mukhtar is an alumnus of Ashridge Business School, UK and has attended other local and international training programmes.

    Aigbavboa, a pharmacist, was educated at the University of Benin (B.Pharm & M.Sc) and Federal University of Technology, Owerri (MBA). He joined UACN in June 1997 as Personal Products Manager in the then GBO – MDS Division. He thereafter, occupied various management positions in the UACN Group including National Customer Service Manager, MDS Logistics and General Manager -Franchise Operations, Mr Biggs. In September 2008, he joined Zain Telecoms, Nigeria where he served as General Manager, North West Regional Operations and Director, Regional Support in the Sales Group.  In June 2009, he returned to UACN and was subsequently appointed in January 2010 as the Managing Director of MDS Logistics Limited. He is a fellow of the Chartered Institute of Supply Chain Management

    Ajibola, a graduate of Industrial Mathematics from the Federal University of Technology, Akure, started his career in UACN as an Assistant programmer in management and computer services before his deployment to CAP as the Tetra CS3 ERP project. He was transferred to MDS Logistics in 2001 to work on the implementation of the Enterprise Warehouse Management System deployed to the business. Upon completion of the project, he was appointed the pioneer ICT Manager of MDS Logistics Limited.  He later became the Warehousing and Depot Operations Manager before his appointment as the General Manager, Operations comprising Warehousing, Haulage and Distribution Operations of the business. He has attended numerous training programmes within and outside the country including Lagos Business School, Cranfield University (UK) and Robert Kennedy College (Switzerland).

     

     

  • UACN closes application for N15.4b rights issue

    UACN closes application for N15.4b rights issue

    Nigeria’s largest and oldest business conglomerate, UAC of Nigeria (UACN) Plc, at the weekend closed application list for its N15.4 billion rights issue.

    UACN had floated a rights issue to raise N15.36 billion by offering 960.43 million ordinary shares of 50 kobo each at N16 per share to pre-qualified shareholders. The new shares were pre-allotted to shareholders on the basis of one new share for every two shares held as at the close of business on October 19.

    The application list for the rights issue, which had opened on November 15, closed on Friday, December 22.

    After deduction of the estimated issue costs and expenses of N333.91 million, representing 2.2 per cent of the gross issue proceeds, the net issue proceeds is about N15.033 billion.

    A breakdown of the utilisation of the net proceeds indicated that the largest chunk of the net proceeds of N15.03 billion will be invested in the Plateau State-based subsidiary-Grand Cereals.

    The board noted that due to increasing cost of raw materials and the planned investment by Grand Cereals into the agricultural value chain, it has identified the need for equity injection into the subsidiary.

    The planned N7 billion rights issue of Grand Cereals will be subscribed to by UACN to the extent of its 64.9 per cent holding in addition to any unsubscribed units. The total amount of proceeds to be used for this investment is N5 billion.

    Also, to further support Grand Cereals’s expansion plans into the agricultural value chain, the board has identified the need for a shareholder loan of N3.5 billion to the subsidiary. However, the planned shareholder loan will be provided on commercial terms to Grand Cereals and upon repayment at a future date will be deployed in the food and agro-processing categories of the Group to enhance shareholder value.

    About N4.8 billion will be spent on supporting the working capital of both the Grand Cereals Limited and Livestock Feeds Plc by part-financing inventory procurement during harvest season of grains and oil seeds. About N2.8 billion will be used for Grand Cereals while N1.2 billion will be devoted to Livestock Feeds.

    According to the conglomerate, the harvest season of grains and oil seeds usually starts in the last quarter of every year when the financial institutions typically adopt tight credit policies to achieve their audited balance sheet goals. The availability of the required funds in a timely manner at that particular time is a competitive imperative. The raw materials will be utilised in the course of the year by the two subsidiaries. Also, the transaction between UACN and the agro-processing subsidiaries will be on commercial terms and at arm’s length.

    The conglomerate has also indicated that it would consider new acquisitions and mergers to further optimise the values of its existing businesses and take advantage of emerging opportunities in other sectors.

    In a circular outlining the operational philosophy of the conglomerate and the purposes of the ongoing new capital raising, the board of directors of the conglomerate stated that it would “continue to explore merger and acquisition opportunities relevant to it businesses”.

    The board of the conglomerate indicated it has earmarked N2.5 billion from the net proceeds of the ongoing rights issue for “product innovation and growth investment in existing markets and adjacent categories”.

  • UACN to close application for N15.4b rights issue Friday

    Nigeria’s largest and oldest conglomerate, UAC of Nigeria (UACN) Plc is scheduled to close the application list for its ongoing N15.4 billion rights issue this Friday, giving shareholders some 48 hours to pick their rights.

    UACN is raising N15.36 billion through a rights issue of 960.43 million ordinary shares of 50 kobo each at N16 per share. The new shares have been pre-allotted to existing shareholders on the basis of one new share for every two shares held as at the close of business on Thursday October 19, 2017.

    The application list for the rights issue opened on November 15, 2017 and it is scheduled to close on Friday December 22, 2017. There are indications the conglomerate may not extend the offer period.

    After deduction of the estimated issue costs and expenses of N333.91 million, representing 2.2 per cent of the gross issue proceeds, the net issue proceeds is about N15.033 billion.

    A breakdown of the utilisation of the net proceeds indicated that the largest chunk of the net proceeds of N15.03 billion will be invested in the Plateau State-based subsidiary-Grand Cereals Limited.

    The board noted that due to increasing cost of raw materials and the planned investment by Grand Cereals Limited into the agricultural value chain, it has identified the need for equity injection into the subsidiary.

    The planned N7 billion rights issue of Grand Cereals will be subscribed to by UACN to the extent of its 64.9 per cent holding in addition to any unsubscribed units. The total amount of proceeds to be used for this investment is approximately N5 billion.

    Also, to further support Grand Cereals Limited’s expansion plans into the agricultural value chain, the board has identified the need for a shareholder loan of N3.5 billion to the subsidiary. However, the planned shareholder loan will be provided on commercial terms to Grand Cereals Limited and upon repayment at a future date will be deployed in the food and agro-processing categories of the group to enhance shareholder value.

    About N4.8 billion will also be used to support the working capital of both the Grand Cereals Limited and Livestock Feeds Plc by part-financing inventory procurement during harvest season of grains and oil seeds. About N2.8 billion will be used for Grand Cereals Limited while N1.2 billion will be devoted to Livestock Feeds.

    According to the conglomerate, the harvest season of grains and oil seeds usually starts in the last quarter of every year when the financial institutions typically adopt tight credit policies to achieve their audited balance sheet goals. The availability of the required funds in a timely manner at that particular time is a competitive imperative. The raw materials will be utilised in the course of the year by the two subsidiaries. Also, the transaction between UACN and the agro-processing subsidiaries will be on commercial terms and at arm’s length.

    The conglomerate has also indicated that it would consider new acquisitions and mergers to further optimise the values of its existing businesses and take advantage of emerging opportunities in other sectors.

    In a circular outlining the operational philosophy of the conglomerate and the purposes of the ongoing new capital raising, the board of directors of the conglomerate stated that it would “continue to explore merger and acquisition opportunities relevant to it businesses”.

    The board of the conglomerate indicated it has earmarked N2.5 billion from the net proceeds of the ongoing rights issue for “product innovation and growth investment in existing markets and adjacent categories”.

    According to the board, it is conscious of the fact that the recent economic downturn presents an opportunity for product innovation and growth investment in existing markets and adjacent categories.

    “Management has been mandated to explore such value-optimising opportunities for investment consideration. The sum of N2.5 billion has been earmarked for this endeavour,” the company stated.

    Nigeria’s oldest surviving business, UACN started business in Nigeria in 1879, well ahead of the 1914 amalgamation that created the current Nigerian nation. With 10 subsidiaries in key sectors of the Nigerian economy, the UACN Group consists of several active companies spreading through manufacturing, services, logistics and real estate sectors of the Nigerian economy. These include four quoted subsidiaries-CAP Plc, UACN Property Development Company (UPDC) Plc, Livestock Feeds and Portland Paints and Products Nigeria Plc; in addition to the parent company, UACN. UPDC Real Estate Investment Trust, which is also quoted on the NSE, is a subsidiary of UPDC.

    UACN acquired Livestock Feeds and Portland Paints in 2013. Other members of the group included UAC Foods Limited, UAC Restaurants Limited, MDS Logistics Plc, Warm Spring Waters Nigeria Limited, Grand Cereals Limited, and Unico CPFA Limited. Listed in 1974, UACN is owned by some 185,000 shareholders. No shareholder holds five per cent and above other than Stanbic Nominees Nigeria, which hold 17.86 per cent equity stake.

  • UACN appoints GMD, MDs, senior executives

    Nigeria’s largest conglomerate and oldest surviving business, UAC of Nigeria (UACN) Plc, has announced major changes in its top management. They are a new Group Managing Director (GMD) for the parent company and Managing Directors for three subsidiaries. All appointments will take effect on January 1, next year.

    Mr Abdul Bello, the Executive Director and Chief Financial Officer (CFO) of UACN, is GMD. He is to succeed Mr. Larry Ettah, who is retiring on January 1, after 11 years as the helmsman of the conglomerate.

    The Group has also appointed Mr Solomon Aigbavboa as the new Managing Director of Livestock Feeds Plc. Aigbavboa, a Pharmacist, is succeeding Mrs Modupe Asanmo, who will be retiring on January 1, 2018 after 10 years of service to the company.

    The board has also appointed Mr Adedamola Olusunmade as the new Managing Director of Portland Paints and Products Nigeria (PPPN) Plc. Olusunmade, a Chemical Engineer who started his career as an Assistant Production Manager with CAP Plc-another UACN subsidiary, in 1999, will be succeeding Mr. Mukhtar Yakassai, who has been appointed to another executive position within the group. Yakassai will however, remain on the board of PPPN as a non-executive director.

    Also, Mrs Oluwakemi Ogunnubi has been appointed as the new Managing Director of CAP Plc, to succeed Mrs Omolara Elemide who has been appointed as the new Executive Director, Corporate Services of UACN. Bello has also been appointed as a non-executive director of CAP, preparatory to his emergence as chairman of the subsidiary.

    Mrs Adeniun Taiwo has been appointed as the new CFO for the UACN Group. Meanwhile, the current executive director, corporate services of UACN, Mr. Joseph Dada, will be retiring on January 1, 2018.

    Nigeria’s oldest surviving business, UACN started business in Nigeria in 1879, well ahead of the 1914 amalgamation that created the current Nigerian nation. The UACN Group consists of several active companies spreading through manufacturing, services, logistics and real estate sectors of the Nigerian economy. These include four quoted subsidiaries-CAP Plc, UACN Property Development Company (UPDC) Plc, Livestock Feeds and Portland Paints and Products Nigeria Plc; in addition to the parent company, UACN. UPDC Real Estate Investment Trust, which is also quoted on the NSE, is a subsidiary of UPDC.

    UACN acquired Livestock Feeds and Portland Paints in 2013. Other members of the group included UAC Foods Limited, UAC Restaurants Limited, MDS Logistics Plc, Warm Spring Waters Nigeria Limited, Grand Cereals Limited, and Unico CPFA Limited.

    UACN is raising N15.36 billion through a rights issue of 960.43 million ordinary shares of 50 kobo each at N16 per share. The new shares have been pre-allotted to existing shareholders on the basis of one new share for every two shares held as at the close of business on Thursday October 19, 2017.

     

    The application list will close on Friday December 22, 2017. After deduction of the estimated issue costs and expenses of N333.91 million, representing 2.2 per cent of the gross issue proceeds, the net issue proceeds is about N15.033 billion. Listed in 1974, UACN is owned by some 185,000 shareholders. No shareholder holds five per cent and above other than Stanbic Nominees Nigeria, which hold 17.86 per cent equity stake.

    Born in November 1960, Bello joined Grand Cereals Limited (GCL), a subsidiary of UACN, on October 23, 1989 as chief accountant.  Prior to joining UACN, he started as management trainee in Inlaks Plc in August 1985.  He was chief accountant of Inlaks Plc, Lagos from January 1987 to September 1989.  A chartered accountant, Bello holds an HND degree in Accountancy from Yaba College of Technology, Lagos.  He is a Fellow of the Institute of Chartered Accountants of Nigeria (ICAN).

    Bello has held various management positions across UACN Group.  Between August 1997 and February 1998, he was Senior Accountant at Accounts Headquarters, UACN.  He was appointed Finance Director & Company Secretary of Chemical & Allied Products (CAP) Plc on April 1, 1998.  He was appointed the Managing Director of CAP Plc February 1, 2003.

  • UACN eyes mergers, acquisitions with new equity capital

    •185,000 shareholders to provide N15.4b

    With 10 subsidiaries in key sectors of the Nigerian economy, Nigeria’s largest and oldest business conglomerate, UAC of Nigeria (UACN) Plc will consider new acquisitions and mergers to further optimise the values of its existing businesses and take advantage of emerging opportunities in other sectors.

    In a circular outlining the operational philosophy of the conglomerate and the purposes of the ongoing new capital raising of N15.4 billion, the board of directors of the conglomerate stated that it would “continue to explore merger and acquisition opportunities relevant to its  businesses”.

    The board of the conglomerate indicated it has voted N2.5 billion from the net proceeds of the ongoing rights issue for “product innovation and growth investment in existing markets and adjacent categories”.

    According to the board, it is conscious of the fact that the recent economic downturn presents an opportunity for product innovation and growth investment in existing markets and adjacent categories.

    “Management has been mandated to explore such value-optimising opportunities for investment consideration. The sum of N2.5 billion has been earmarked for this endeavour,” the company stated.

    Nigeria’s oldest surviving business, UACN started business in Nigeria in 1879, well ahead of the 1914 amalgamation that created the current Nigerian nation. The UACN Group consists of several active companies spreading through manufacturing, services, logistics and real estate sectors of the Nigerian economy. These include four quoted subsidiaries-CAP Plc, UACN Property Development Company (UPDC) Plc, Livestock Feeds and Portland Paints and Products Nigeria Plc; in addition to the parent company, UACN. UPDC Real Estate Investment Trust, which is also quoted on the NSE, is a subsidiary of UPDC.

    UACN acquired Livestock Feeds and Portland Paints in 2013. Other members of the group included UAC Foods Limited, UAC Restaurants Limited, MDS Logistics Plc, Warm Spring Waters Nigeria Limited, Grand Cereals Limited, and Unico CPFA Limited.

    UACN is raising N15.36 billion through a rights issue of 960.43 million ordinary shares of 50 kobo each at N16 per share. The new shares have been pre-allotted to existing shareholders on the basis of one new share for every two shares held as at the close of business on Thursday October 19, 2017. The application list will close on Friday December 22, 2017. After deduction of the estimated issue costs and expenses of N333.91 million, representing 2.2 per cent of the gross issue proceeds, the net issue proceeds is about N15.033 billion. Listed in 1974, UACN is owned by some 185,000 shareholders. No shareholder holds five per cent and above other than Stanbic Nominees Nigeria, which hold 17.86 per cent equity stake.

    A breakdown of the utilisation of the net proceeds indicated that the largest chunk of the net proceeds of N15.03 billion will be invested in the Plateau State-based subsidiary-Grand Cereals Limited.

    The board noted that due to increasing cost of raw materials and the planned investment by Grand Cereals Limited into the agricultural value chain, it has identified the need for equity injection into the subsidiary.

    The planned N7 billion rights issue of Grand Cereals will be subscribed to by UACN to the extent of its 64.9 per cent holding in addition to any unsubscribed units. The total amount of proceeds to be used for this investment is approximately N5 billion.

    Also, to further support Grand Cereals Limited’s expansion plans into the agricultural value chain, the board has identified the need for a shareholder loan of N3.5 billion to the subsidiary. However, the planned shareholder loan will be provided on commercial terms to Grand Cereals Limited and upon repayment at a future date will be deployed in the food and agro-processing categories of the group to enhance shareholder value.

    About N4.8 billion will also be used to support the working capital of both the Grand Cereals Limited and Livestock Feeds Plc by part-financing inventory procurement during harvest season of grains and oil seeds. About N2.8 billion will be used for Grand Cereals Limited while N1.2 billion will be devoted to Livestock Feeds.

    According to the conglomerate, the harvest season of grains and oil seeds usually starts in the last quarter of every year when the financial institutions typically adopt tight credit policies to achieve their audited balance sheet goals. The availability of the required funds in a timely manner at that particular time is a competitive imperative. The raw materials will be utilised in the course of the year by the two subsidiaries. Also, the transaction between UACN and the agro-processing subsidiaries will be on commercial terms and at arm’s length.

     

  • UACN gets regulatory approval to raise N15.4b new equity capital

    Authorities at the Nigerian Stock Exchange (NSE) have approved application by Nigeria’s oldest surviving business, UAC of Nigeria (UACN) Plc, to raise about N15.4 billion in new equity funds.

    A regulatory document at the weekend indicated that the Quotation Committee of the Exchange, which oversees listing of shares, has approved the supplementary capital raising.

    UACN plans to raise N15.36 billion through a rights issue of 960.43 million ordinary shares of 50 kobo each at N16 per share. The new shares will be pre-allotted to existing shareholders on the basis of one new share for every two shares held as at the close of business on Thursday October 19, 2017.

    Shareholders of UACN had earlier approved the plan to raise new equity funds by selling new ordinary shares to existing shareholders.

    UACN will use the net proceeds of the new equity issue to bolster its working capital and support the recapitalisation and operations of its subsidiaries.

    In an explanatory statement on the proposed rights issue, the board of the conglomerate had stated that many subsidiaries within the group including three quoted companies- UACN Property Development Company, Livestock Feeds and Portland Paints and Products Nigeria, need working capital support to boost their operations and reduce dependence on costly bank loans.

    According to the board, it is important that the conglomerate is resourced to support the subsidiaries at the critical time.

    “In the prevailing environment of economic challenges and recession, there would also be opportunities for additional investment in current and adjacent categories that we play in,” the board stated.

    Directors of the conglomerate said they believed that the N15 billion rights issue would enable them to support the subsidiaries through these difficult times and provide the required flexibility to deepen the group’s position as opportunities for additional investments emerge in the chosen markets.

    At the meeting  on June 14, 2017 meeting, shareholders authorised the board to raise up to N15.4 billion by way of a rights issue, through the issuance of ordinary shares on such other terms and conditions as the directors may deem fit or determine.