SEC, FCCPCC To Collaborate On Mergers

SEC
SEC

The Securities and Exchnage Commission, SEC and the Federal Competition and Consumer Protection Commission (FCCPCC), have agreed to continue to work together in a bid to simplify the processes of Mergers of companies in Nigeria.

Acting Director General of the SEC, Ms. Mary Uduk revealed this during the signing of a  memorandum of understanding between the SEC and FCCPCC in Abuja, recently.

Uduk emphasized the need for collaboration between both organisations to ensure that there is no vacuum  in a bid to ensuring that the collaboration would lead to a more stronger economy for the country.

“We are happy with the work the FCCPCC has done so far and on our part as the SEC, we are willing to provide you with any relevant assistance you would need to hit the ground running and improve our nation’s economy” she said.

The Acting DG disclosed that the Commission presently has capacity in the area of mergers and would be willing to share knowledge with the new organisation.

In his remarks, the Director General of  FCCPCC, Mr. Babatunde Irukera Commended the DG for the leadership the SEC has provided and for the friendship and collaboration that has helped to bring both organisations this far.

According to him, “We would like to commend the way you have approached your work, especially the merger review, I think it has become examplenary to everyone and the rest of the country and both internationally and domestically, and your mode of leadership made it possible.

“The work between the two organizations has created a master stroke and without your leadership it would not have been possible.“Not only has that helped this new institution to begin to get its bearing correctly it has also helped the investment community to see what the real possibilities are available in Nigeria”.

SEC holds Q2 2019 CMC Meeting

SEC holds Q2 2019 CMC Meeting
SEC holds Q2 2019 CMC Meeting

The Securities and Exchange Commission (SEC) has announced that the Second Capital Market Committee (CMC) meeting in 2019 has been scheduled to hold on Thursday August 22 to Friday August 23, 2019 at the Eko Hotels and Suites, Victoria Island, Lagos.

While the key stakeholders in the capital market will meet on August 22, members of the media would be briefed on August 23 on the outcome of the CMC meeting.

However, the SEC has advised that admission into the venue would be upon presentation of the CMC Identity Card and strictly by invitation.

According to the SEC, “Attendance to both events is strictly by invitation. Invited participants are expected to come with their identity cards to be admitted into the venue and all invited participants are expected to be seated by 9.45am,”

The CMC was mainly established to serve as a medium for exchange of ideas among market stakeholders as well as for feedback to SEC on how to continuously improve the market activities and regulation.

It is an industry-wide committee comprising members of the commission, representatives of capital market operators and trade groups and other stakeholders. The CMC meets every quarter to deliberate on various issues affecting the market and other policy matters.

During the meeting, issues bordering on implementation of the Ten Year Capital Market Master Plan as well as others relating to the capital market, Fintech Roadmap and the economy would be discussed and the outcome made known to the media.

The ten-year master plan for the Nigerian capital market which is expected to refocus the market and help double its size over time and grow the economy was unveiled November 2014.

Recall that the Commission has vigorously implemented some initiatives in the Master Plan with the aim of attracting more investors to the market.

Some of the initiatives, include direct cash settlement, regularisation of multiple subscription, dematerialization and e-Dividend Registration, as they promote transparency, protect and enhance investors’ confidence in the capital market.

The SEC therefore enjoins all shareholders to take advantage of the initiatives introduced in the capital market aimed, primarily, at strengthening the market and accelerating economic development.

This, SEC said is in consonance with the present administration’s economic strategy focused on deepening the capital market as a vehicle for encouraging a private sector-led economy with enhanced productivity.

Those who have been invited to attend the expanded session are Chief Executive Officers (CEOs) of all registered capital market firms (i.e Broker Dealer, Capital Market Solicitors, Custodians, Fund Managers, Issuing Houses, Rating Agencies, Registrars, Reporting Accountants, Trustees, and Consultants, etc.);

Others are Chief Executive Officers of The Nigerian Stock Exchange (NSE), National Association of Securities Dealers (NASD), The Financial Markets Dealers Quotations (FMDQ), Africa Exchange Holdings (AFEX), Nigeria Commodity Exchange (NCX), Central Securities Clearing System (CSCS), Chartered Institute of Stockbrokers (CIS); as well as representatives of relevant Financial Services’ Agencies, among others.

 

Again NSE Market Indicator Drops, Losses N33 Billion

 

Activities on the Nigerian Stock Exchange (NSE) sustained negative trend on Thursday with the market indicators dropping further by 0.26 per cent.

Specifically, the All Share Index, which opened at 29,375.25, lost 75.16 points or 0.26 per cent to close at 29,300.09.

Also, the market capitalisation of listed equities shed N33 billion or 0.26 per cent to close at N12.914 trillion against N12.947 trillion reported on Wednesday.

Analysts at Afrinvest Limited said they expected the bearish streak to be sustained in the absence of catalysts to stimulate investors’ sentiment.

Also, analyst at Imperial Asset Managers Limited also expected the market to continue within the existing range today amid bargain hunting on low priced stocks.

An analysis of the price movement chart shows that NASCON led the gainers’ table, appreciating by 70k to close at N15 per share.

Cement Company of Northern Nigeria Plc followed with a gain of 50k to close at N15; also, the Dangote Sugar Refinery owned by one of the richest people in Nigeria gained 45k to close at N11.45 per share.

Custodian and Investment also garnered close a N6.25, while Ecobank Transnational Incorporated increased by 40k to close at N10.40 per share.

Conversely, Presco led the losers’ chart declining by N5.20 to close at N46.80 per share.

Guaranty Trust Bank Plc trailed with a loss of 50k to close at N29.50, while Guinness shed 30k to close at N47.50 per share.

Dangote Flour was down by 25k to close at N17.25, while Oando dipped 10k to close at N3.85 per share.

SEC urges defunct Skye Bank shareholders to claim dividends

The Securities and Exchange Commission has issued a circular, reiterating its earlier directives to shareholders of defunct Skye Bank Plc to claim their dividends.

The acting Director-General, Ms Mary Uduk, said the directive was part of its investor protection programme to ensure that shareholders got the benefits of investing in the capital market.

She said, “We have informed shareholders of the defunct Skye Bank that unclaimed dividends declared by the bank are being held in trust on their behalf. This will further help reduce the volume of unclaimed dividends in the market and boost investor confidence

“Investors that have unclaimed dividends are, therefore, advised to contact Cardinalstone Registrars to process their dividend payments.”

Uduk said the commission has also directed Cardinalstone Registrars and STL Trustees to ensure that all genuine claims of beneficiary shareholders were addressed forthwith.

She said since the company was no longer in operation, the unclaimed dividends had to be made available to the rightful owners as it would go a long way in boosting investor confidence in the market.

“They invested in a company and since the company has gone under, there is no reason why they should not have access to their unclaimed dividends. That is why we are calling on them to take advantage of this opportunity and claim their dividends,” Uduk stated.

Stock market slumps by N479bn in June

The nation’s stock market slumped by 3.55 per cent in June as investors recorded losses totalling N479bn.

The market, which opened the month of June with a market capitalisation of N13.685tn, a value recorded on May 31, 2019, closed 1102.5 basis points lower at a market capitalisation of N13.206tn on Friday, June 28, which was the last trading day in the month.

After three consecutive weeks of losses, investors in the stock market gained N50.9bn in the last week of the month, which is also the last week in the first half of the year.

The market opened the year with a market capitalisation of N11.721tn, dropping to its lowest point during the year at N10.627tn on May 15, a day before MTN Nigeria Communications Plc’s listing on the Nigerian Stock Exchange.

MTN listed its shares on May 16, driving the market capitalisation up to N12.526tn as it added N1.8tn to the total market capitalisation.

The market capitalisation climbed further to N13.400tn on May 21 and N13.864tn on May 23, after which it started declining, dropping to as low as N13.048tn on June 26.

The market witnessed a rebound on June 27 as the market capitalisation gained N62bn to settle at N13.110tn, and a further N96bn on June 28 to settle at N13.206tn.

Analysts at Vetiva Capital Management Limited said while the election season and MTN listing were the two major factors that shaped market performance in H1, they believed the second half of the year would be primarily driven by economic policy direction (early appointment of cabinet members) and expected the listing of large corporates, among others.

They said, “While current cheap valuations on the exchange support an expectation for a market correction in H2’19, we expect the market to continue to exhibit a mixed trading pattern as investors remain wary of unimpressive macroeconomic conditions.”

Airtel set to announce share price, size today

Investors are optimistic of a fair price for Airtel Nigeria shares as the telecom company prepares to announce its share price and size today (Friday) ahead of its listing on the Nigerian Stock Exchange.

Capital market analysts also noted that investors were expectant that they would have an opportunity to invest in the telecom company.

Nigeria’s third largest telecom company had offered between 501.125 million and 716.406 million shares to Nigerians.

The company had also set a price range of N363 to N454 per share.

According to the company’s prospectus, the shares will start trading on the NSE on July 4 and the initial offer, which will be open to institutional investors and high net worth individuals only, would be issued through a book building process.

The Chief Executive, Chartered Institute of Stockbrokers, Mr Adedeji Ajadi, explained that the book-building process would give adequate information on the shares, which would be of benefit to the company and investors.

“The book-building will quicken the process of getting the relevant information about the shares. It helps the underwriters to also determine the price of the IPO,” he added.

Also, a capital market analyst, Mr Rotimi Fakayejo, said the process would allow the company to understand the value investors placed on the company and allow the telco to fix a price threshold.

“The company wants to size up ahead of time the success of the offer and what kind of valuation people are placing on the company. When they see different offers, they will look at a threshold whereby anyone below it will not be able to buy the shares. This is just to test the heartbeat of the market in terms of pricing and demand.”

Through the share listing on the Nigerian bourse and Airtel Africa IPO on the London Stock Exchange, the telco said it intended to use the net proceeds to reduce a debt of $750m and achieve a targeted leverage ratio of 2.5x, based on underlying EBITDA for the year ended March 31, 2019.

It highlighted other objectives of the issuance of ordinary shares as a way to the establishment of an independent capital structure and governance framework.

It named the issuing houses for the offer as Barclays Securities Nigeria and Quantum Zenith Securities Investments Limited.

Airtel said the application had been made to the NSE for the ordinary shares to be admitted to the official list of the Exchange.

Samsung’s Egina wins French project award

Samsung Heavy Industries Nigeria (SHIN) has received the ‘Project of the Year’ award at the African Assembly, organised by the Oil & Gas Council in Paris.

SHIN received the award, along with its client, Total, for the Egina Floating Production Storage and Offloading unit (FPSO), which will add 200,000 barrels of crude oil per day (bpd) to Nigeria’s daily oil production.

Together, the companies received not one but two awards – 2018’s ‘Breakthrough Deal of the Year’ and 2019’s ‘Project of the Year’.

Receiving the award, the Chief Executive Officer of SHI-MCI FZE, the joint venture of SHIN, Mr. Dongseong Suh said: “It is proof of our collective philosophy that responsible investment, powered by a belief in people, can drive real change. Nigeria can stand tall in the world. It is now home to a world-class fabrication and integration yard. Together we have proved that Nigeria’s local content rules work. They can be the platform that delivers shared economic success for ordinary Nigerians, for the country as a whole. That’s why this award is so important to not only to Samsung Heavy Industries Nigeria but for the nation of Nigeria. I thank you, and I accept this award with honour and pride.”

The Council, an influential international network of global oil and gas company executives, organises multiple meetings, including the annual Africa Assembly, which is recognised as the region’s most influential corporate development, strategy, finance and investment gathering.

CAP declares N2.03bn dividend to shareholders

Image result for Chemical and Allied Products PlcChemical and Allied Products Plc has declared a dividend of N2.90 per 50 kobo ordinary share to its shareholders for the 2018 financial year.

The shareholders, at the company’s 54th Annual General Meeting in Lagos, endorsed the total dividend of N2.03bn for payment and commended the company for the efforts that had been put in place to drive increased return on investment.

They said the company had been consistent in delivering results over the years.

The acting Chairman, CAP Plc, Mr Solomon Aigbavboa, said despite the challenging operating environment in 2018, the company ended the year with an impressive performance.

Aigbavboa, while assuring shareholders of steady growth in profitability and expansion, noted that the business recorded a sales turnover of N7.76bn, representing a growth of nine per cent over the previous year, while the operating profit grew by 15 per cent to N2.28bn.

He said, “The economy is expected to gain traction this year on the back of stronger household consumption and public spending. The recent slide in oil prices and OPEC’s oil output cut pose downside risks going forward.

“Economic analysts see Gross Domestic Product increasing by 2.4 per cent in 2019 and 2.9 per cent in 2020, respectively. Your company is closely following developments at all levels and is prepared to key into opportunities that will be created. We are equally poised to take advantage of other structured reforms of the Federal Government, which may impact the housing and real estate sector”.

Aigbavboa said the business would respond appropriately to the emerging paint market trends and the different economy scenarios by opening new Dulux colour centres, developing new businesses, increasing volumes, consistently engaging with professionals and specifiers,  completing DCC upgrades, introducing new products and value-added services.

He said the group would also launch virtual DCC, entrench its presence in the standard market, build people capabilities and implement impactful marketing initiatives to ensure effective customer engagement.

Analysts at Vetiva Capital Management Limited have said there is a dearth of sustainable catalysts to support the nation’s capital market.

Investors in the market lost a total of N78.1bn last week as the market capitalisation of equities listed on the Nigerian Stock Exchange dropped to N13.154bn on Friday from N13.232bn the previous week.

The All Share Index broke its 30,000 points support level on Monday last week as the losses, which began the previous week, continued, taking the year-to-date losses to -5.02 per cent, compared with a loss of 29 basis points in the corresponding period last year.

During the week, there were days where several sectors closed in the green but their gains were overwhelmed by the negative performance of heavyweights, which dragged the overall performance.

Nestlé Nigeria Limited and MTN Nigeria Communications Plc traded negative, closing at N1,350 and N130, respectively.

A total turnover of 7.476 billion shares worth N91.107bn in 17,192 deals was traded last week by investors on the floor of the Exchange in contrast to a total of 868.739 million shares valued at N15.792bn that exchanged hands the previous week in 12,201 deals.

The financial services industry (measured by volume) led the activity chart with 6.121 billion shares valued at N17.460bn traded in 8,479 deals, thus contributing 81.87 per cent and 19.16 per cent to the total equity turnover volume and value, respectively.

Stocks in the financial services sector remained the most actively traded by value, with Guaranty Trust Bank Plc accounting for a significant portion of it.

The oil and gas industry followed with 1.002 billion shares worth N65.058bn in 2,019 deals.

The Information  and Communications Technology industry recorded a turnover of 115.320 million shares worth N3.387bn in 866 deals.

The consumer goods sector was the worst performer last week, down by 164bps week-on-week and with a loss of -19.49 per cent year-to-date.

The banking sector, which appreciated by 253bps week-on-week, and the industrial goods sector, which appreciated by 317bps week-on-week, closed as the best-performing sectors.

Analysts at Vetiva said current share prices still presented an attractive entry point for investors, while analysts at Afrinvest Securities Limited said they expected investors to take positions in fundamentally sound stocks as the half-year earnings season was approaching.

Oando, SEC saga: Court adjourns case to July 22

A Federal High Court sitting in Lagos has adjourned to July 22 a case brought by Oando Plc to stop the Securities and Exchange Commission from replacing its chief executive officer and making changes to the management team.

SEC’s action followed an investigation where it allegedly found evidence of financial infractions by the company.

Oando dismissed the SEC charges as unsubstantiated and called for SEC to release the full audit on which it based its charges.

SEC said in a statement on Monday that the court also fixed July 4, 2019, to hear arguments on the motion for consolidation.

At the resumed hearing, Mr Yele Delano, announced appearance for Oando and expressed the company’s intention to be joined in the suit, as well as sought consolidation of similar suits pending before the court, according to the statement,

Delano was said to have also sought an adjournment to enable him to file his processes in the suit.

In response, the counsel to SEC, Chief Anthony Idigbe, raised an objection to Oando’s request for joinder on the grounds that it would pre-determine the respondent’s case.

He argued that the issue of application consolidation was intended to frustrate the case, thereby elongating the hearing of the case.

Idigbe further argued that the party in question had not formally processed the application for consolidation but made a “mere oral expression.”

He said, “My Lord, this matter was adjourned to today for hearing, and I am prepared to go on. The issue of consolidation of the cases is meant to accelerate the matter rather than taking it backward.”

Idigbe urged the court to refuse the application, saying if the court allowed the joinder, it would have pre-determined the case of the defence.

The counsel to the applicants, Mr Tayo Oyetibo, argued in favour of the request for joining and urged the court to allow the party seeking to be joined in the suit.

According to him, if the court refuses the application for joinder and the party goes on to appeal, then the applicant will be affected.

In a short consideration of the issues, the court held that it was far-reaching to think that the grant of an adjournment to enable a party to file a motion would be considered prejudicial to the defence.

Justice Ayokunle Faji thus adjourned the case until July 4 to hear arguments on the motion for consolidation, and also fixed July 22 for the hearing of the substantive suit.