Economy
$60m Buyout: Shareholders Want Forensic Audit of 7up
By Dipo Olowookere
Both the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE) have been urged to urgently to conduct a forensic audit of Nigeria’s 7Up Bottling Company.
This plea was made by Nigerian shareholders in the firm and it followed the planned buyout by Affelka, its parent company of 7Up.
This development is also coming at a time one of the leading indigenous oil firm in Nigeria, Oando Plc is facing a similar crisis, though the firm is preventing the regulator from conducting a forensic audit of its affair.
This issue allegedly led to the suspension of the regulatory chief, Mr Mounir Gwarzo, by the Minister of Finance, Mrs Kemi Adeosun.
The shareholders want the capital market regulators to unravel circumstances surrounding the deal, which they believe is not totally clean.
Speaking with Daily Sun on telephone, the shareholders argued that they were unconvinced that the recent takeover notification of the company was not fraudulent scheme as there was no reason to suggest the firm was doing badly in its sector.
Recall that Affelka, majority shareholder of Seven-Up Bottling Company, had last week offered to pay $60 million (N19.33 billion) to buy out minority shareholders in Nigerian operation. According to the proposal, the buyout is aimed at restructuring the struggling company.
Affelka is the privately held investment firm owned by Lebanese El-Khalil family and it is offering to pay N112.70 per share for the minority stake of 171.5 million shares. This is an 18 percent premium to last Thursday’s share price of N95.50k.
“As of now, we have received an offer from the majority shareholder of the company. It’s a financial restructuring,” said Sunil Sawhney, Vice Chairman of 7Up Bottling Company.
He said the company has been making losses for some time and that the deal was aimed at restructuring the bottler, which distributes PepsiCo’s 7Up, Pepsi and Mirinda-branded drinks.
But minority shareholders in Nigeria rejected Sawhney’s explanation, pointing out that they seriously smelled a rat, and argued that the notification was out to short-change local investors.
According to Mr Gbadebo Olatokunbo, a shareholder activist, the 57 years old company is making good sales and profit with very good price at the NSE with the good result and return on investment in 2014.
“But suddenly, by the first half of 2015, something known only to its few foreign team within the company happened and the company started reporting losses.
“The drift continued and the same powers behind the scenes are now ready to buyout local investors at their price,” Mr Olatokunbo wondered.
He asked, “Why the renewed interest of the majority shareholders in a suddenly sick company? Why are they now interested in the takeover when the company wasn’t growing? How are we sure they weren’t the brains behind the unexpected bad results?”
Mr Olatokunbo stated that, “We are of very strong view that the proposed injection of $60 million is part of our profit on investments in 7Up, which was denied us and now about to be presented as a bailout-fund for a very solid 7Up Company, which we view with serious suspicion. It is a slap on our collective business senses and we hereby ask for a forensic audit of our company, 7Up, from 2014.”
In his own reaction, President of Nigeria Shareholders Solidarity Association (NSSA), Mr Timothy Adesiyan, said the news of the buyout offer was very disheartening.
“We thank God for the life of the former President, Olusegun Obasanjo, who made it possible for Nigerians to be part owners of these multinationals because it was during his tenure that a law was made, which made it possible for Nigerian shareholders to be part owners of these companies.
“But what is happening now is very disheartening because the gimmick is to shut out the local investors.
“The Securities and Exchange Commission (SEC) and Nigerian Stock Exchange (NSE) are not helping matters because most of the people there now don’t know what it took the former president to make Nigerians part owners of these multinationals,” he lamented.
He appealed to the Federal Government to look into the matter to stop foreigners from short-changing local investors because they are making money here.
For his part, Mr Boniface Okezie, National Coordinator, Progressive Shareholders Association of Nigeria (PSAN), blamed SEC and NSE for this issue.
According to him, “we saw it coming. Since SEC and NSE approved the delisting of NBC, we knew that others will follow suit. What are they restructuring?”
He explained that all boils down to short-changing local shareholders, adding that they are just after the buyout to delist from NSE and then, escape from corporate governance code because they are no longer listed.
Mr Okezie, however, urged the capital market regulators to subject 7Up to rigorous test to confirm some of its claims and also not to renege on its regulatory role of protecting minority shareholders.
By Adedapo Adesanya
Market bellwethers, Central Securities Clearing System (CSCS) Plc and FrieslandCampina Wamco Nigeria Plc, lifted the NASD Over-the-Counter (OTC) Securities Exchange by 2.08 per cent on Monday, August 3.
CSCS Plc, the Nigerian securities depository company, gained N10.00 to close at N112.00 per share compared with the previous session’s N102.00 per share, and FrieslandCampina Wamco Nigeria Plc advanced by N4.71 to quote at N152.64 per unit versus last Friday’s N147.93 per unit.
As a result, the NASD Security Index (NSI) added 92.14 points to finish at 4,523.85 points compared with the preceding session’s 4,431.71 points, and the market capitalisation appreciated by N55.31 billion to N2.715 trillion from N2.659 trillion.
Business Post reports that the price of MRS Oil Plc crashed during the trading day by N12.00 to N120.00 per share from N132.00 per share, and UBN Property Plc dipped by 3 Kobo to N1.90 per unit from N1.93 per unit.
Trading data showed that the volume of securities exchanged rose by 113.1 per cent to 1.5 million units from 690,990 units, and the number of deals climbed by 19.2 per cent to 31 deals from 26 deals, while the value of securities slid by 13.1 per cent to N65.2 million from N75.0 million.
Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 76.8 million units traded for N5.5 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units exchanged for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Adedapo Adesanya
The Nigeria Revenue Service (NRS) has introduced a 1.5 per cent stamp duty on eligible virtual asset transactions, with the tax deducted directly from the cryptocurrency purchased before it is credited to the buyer’s wallet.
According to the new guidelines issued on Monday, anyone buying Bitcoin (BTC), USDT or other cryptocurrencies in Nigeria will receive fewer digital assets due to the deduction.
This requires registered crypto exchanges and other Virtual Asset Service Providers (VASPs) to withhold the levy in the digital asset being traded and remit it to the government, marking Nigeria’s most comprehensive move yet to bring cryptocurrency transactions into the country’s tax net.
Unlike traditional taxes deducted from a customer’s bank account, the 1.5 per cent charge will be taken from the cryptocurrency itself, meaning buyers will receive less Bitcoin, USDT or other tokens than they paid for.
The tax body stated that “income tax deducted at source and stamp duty shall be remitted to the service in the originating token of the transaction.”
Besides the new stamp duty, the guidelines also clarify how income tax, Value Added Tax (VAT) and other tax obligations will apply to virtual asset activities such as trading, staking, mining and other crypto-related transactions.
To illustrate the new rule, the tax authority said a buyer who pays N1 million for one Bitcoin will receive only 0.985 BTC after 0.015 BTC is deducted as stamp duty and remitted to the government. When that Bitcoin is later sold, the next buyer will also have 1.5 per cent deducted from the cryptocurrency credited to their wallet.
The NRS said the guidelines are intended to provide clarity for taxpayers, crypto exchanges, peer-to-peer (P2P) marketplace operators, financial institutions, tax consultants and all participants in Nigeria’s virtual asset ecosystem.
According to the guidelines, the 1.5 per cent duty applies to eligible virtual asset transactions facilitated through registered exchanges and other recognised intermediaries. Where a cryptocurrency is used to complete a transaction that already attracts stamp duty under the law, the applicable duty on the underlying instrument will also be payable.
For crypto users, the implication is higher transaction costs, as eligible purchases will attract the 1.5 per cent stamp duty, while VAT on exchange service fees and income tax on taxable gains may also apply, depending on the nature of the transaction.
By Adedapo Adesanya
The Naira opened the week on a positive note, as it appreciated against the US Dollar by N3.39 or 0.25 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Monday, August 3, to N1,364.83/$1 from N1,368.22/$1 last Friday.
However, it suffered a marginal decline against the Pound Sterling in the official market during the session by 10 Kobo to close at N1,837.89/£1 compared with the preceding session’s N1,837.79/£1, and lost 6 Kobo on the Euro to sell at N1,573.93/€1, in contrast to the previous trading day’s N1,573.87/€1.
At the black market segment, the Nigerian currency traded flat against the Dollar yesterday at N1,405/$1, and at the GTBank forex counter, it was unchanged at N1,374/$1.
Interbank FX transactions increased sharply as market makers’ activities raised total Dollar volume exchanged to $137.048 million, more than 132 per cent above $58.990 million in turnover at the previous close. The surge in turnover was driven by increased deals at the NFEM window. The central bank reported that deal count at the interbank FX window rose to 138 from 67 on Friday.
As for the cryptocurrency market, major tokens advanced despite ongoing uncertainty around unresolved Coldcard wallet sweeps that have drained hundreds of Bitcoin (BTC), while traders are watching whether bitcoin can hold above $63,000 through the US session. BTC rose by 1.70 per cent to $63,765.88.
Bitcoin treasury firm Strategy disclosed Monday it sold 1,638 bitcoin for about $105 million between July 27 and Aug. 2, its third sale of 2026, per an SEC filing.
Also, an attacker has moved about 1,816 bitcoins, or roughly $114 million, from more than 5,200 addresses since July 30 in a fourth wave of sweeps targeting BTC in Coldcard-generated addresses.
Cardano (ADA) appreciated by 6.7 per cent to $0.1959, Binance Coin (BNB) gained 1.5 per cent to sell for $590.82, Solana (SOL) jumped by 1.3 per cent to $73.72, TRON (TRX) soared by 0.9 per cent to $0.3286, Dogecoin (DOGE) also grew by 0.9 per cent to $0.0703, Ripple (XRP) advanced by 0.5 per cent to $1.07, and Ethereum (ETH) rose by 0.4 per cent to $1,863.33, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 apiece.
