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C&I Leasing Explains Delay in Completing Share Reconstruction

By Modupe Gbadeyanka

The board of C&I Leasing Plc has explained why it was yet to complete the reconstruction of its share capital, which started some weeks ago.

In December 2018, the company announced that it had received the received the approval of the Nigerian Stock Exchange (NSE) to reduce its share capital by 75 percent.

C&I Leasing had said it was cutting its share capital to about 404.3 million from 1.6 billion on a ratio of four to one.

The firm had explained that this was to allow the company have enough unissued shares to accommodate future plans to raise capital through the equity capital market.

“C&I Leasing is pleased to notify its esteemed shareholders,stakeholders, dealing members and the general public that the company has made an application to the Nigerian Stock Exchange and obtained a ‘No Objection’ to its proposal to reduce the company’s issued and paid-up share capital from N808,505,000 being 1,617,010,000 ordinary shares of 50 kobo each to N202,126,250 being 404,252,500 ordinary shares of 50 kobo each by consolidating every four ordinary shares currently held into one new share in the company,” the statement had said.

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As a result of this, the NSE placed a suspension on trading of the shares of the company on Thursday, December 13, 2018 to allow for the consolidation exercise.

But since then, some shareholders were becoming worried that the share price of C&I Leasing on the local stock exchange was yet to reflect the new price.

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Business Post reports that as at the close of business last Friday, the share price of C&I Leasing was still stagnant on the NSE at N1.78k per unit as a result of the suspension.

Shareholders of the firm are expecting the share price to go for N7.12k per share as soon as the suspension was lifted by the NSE.

In a statement issued by the company at the weekend, it was explained that the process was yet to be finalised, promising that it would be finalised in the coming days.

Giving reason for the delay, the company said it was “due to the delay in reconciliation of the shareholding.”

“We refer to our press release of December 10, 2018 on the application made to the Nigerian Stock Exchange (NSE) for the consolidation of every four ordinary shares currently held into one new share in the company and the placement of the shares of the company on suspension from Thursday, December 13, 2018 to Thursday, December 27, 2018 to allow for the consolidation exercise.

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“Unfortunately, due to the delay in reconciliation of the shareholding, the exercise has not been completed. We are now close to completing the exercise and the suspension will be lifted in the coming days,” the statement said.

Recall that last week, it was reported that Abraaj Group was converting its $10 million loan stock to shares of C&I Leasing, which will make the company control about 70 percent state in the Nigerian firm. Chief Executive Officer of C&I Leasing, Mr Andrew Otike-Odibi, was also quoted to have said last week that the firm was planning a rights issue or an initial public offering that may dilute Abraaj’s stake to about 30 percent.

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Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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