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Abraaj ‘Takes Over’ 70% Stake in C&I Leasing

**As C&I Leasing Plans to Dilute Abraaj Holdings to 30%

**Mulls IPO, Rights Issue

By Dipo Olowookere

Information has it that Abraaj Group, the private-equity firm established in 2002 by a Pakistani businessman, Mr Arif Naqvi, is now acquiring about 70 percent stake in a Nigeria-based company, C&I Leasing Plc.

Recall that two days ago, the Nigerian firm announced that Abraaj had agreed to convert its $10 million loan stock to equity in the company.

A report by Bloomberg quoted Chief Executive Officer of C&I Leasing, Mr Andrew Otike-Odibi, as saying that Abraaj felt taking its funds out of the firm could wreck the business. As a result, it considered the option of staying to convert the debt to equity.

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“Abraaj knows that pulling out $10 million will be detrimental to the growth of the business, so rather than cash out, they decided to convert (to the company’s shares),” Mr Otike-Odibi was quoted to have said by phone from Lagos.

With this, according to Bloomberg, “Abraaj Group, the private-equity firm that collapsed after defaulting on debt, will get a 70 percent stake in C&I Leasing Plc by converting a $10 million loan into equity in the Nigerian company.”

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Mr Otike-Odibi further said already, C&I Leasing is planning a rights issue or an initial public offering that may dilute Abraaj’s stake to about 30 percent.

Abraaj, once one of the most high-profile private-equity companies in the Middle East until its dramatic failure last year, is being restructured by liquidators in a bid to settle more than $1 billion of its debts through asset sales.

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Bloomberg said the firm’s Lagos office didn’t respond to an email seeking comment.

Business Post reports that C&I Leasing, which is presently on suspension with a share price of N1.78k per unit, announced in December 2018 that it was reconstructing its share capital by 75 percent on a ratio of four existing shares to a new share.

By our calculations, this will reduce the company’s share capital to about 404.3 million from 1.6 billion.

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Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

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