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Economy

UAC Shareholders to Meet for Transfer of UPDC REIT Stocks

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UAC Shareholders

By Dipo Olowookere

On Monday, September 20, 2021, shareholders of UAC Nigeria Plc will gather for a court-ordered meeting (COM) to decide on what to do with the shares of the company in UPDC Real Estate Investment Trust (REIT).

Business Post reports that on Friday, July 23, 2021, the company obtained an order from a federal high court to convey a meeting of shareholders concerning the subject matter.

As part of a strategic review in 2018, the board and management of UAC Plc agreed that in the best interest of the company and to deliver more value to shareholders, it was necessary for the organisation to exit from its investments in the real estate sector in order to focus on the sectors that align with its core strategy.

UAC has the aim to generate attractive long-term, risk-adjusted returns for investors by growing its businesses into market leaders in their respective segments.

But because it was getting involved in different sectors, achieving this target was becoming difficult and it felt it was necessary to trim its operations to its core area of expertise.

The firm operates in animal feeds and edible oils, packaged food and beverages, paints, logistics, quick service restaurants (QSR) and real estate through UPDC Plc.

In 2020, UAC, as part of the unbundling strategy, reduced its ownership in UPDC from 93.86 per cent to 42.85 per cent following the sale of a 51 per cent stake to Custodian Investment Plc.

Last year, UPDC embarked on a process of unbundling its holdings in UPDC REIT to all its shareholders to maximise returns to its investors by providing direct access to the steady and regular dividend distributions of UPDC REIT as well as improving trading liquidity in UPDC REIT units.

As a result, UPDC transferred 649,392,661 units of UPDC REIT stocks to UAC, which still remains as one of its shareholders.

The board of UAC wants to transfer the 649,392,661 units of UPDC REIT shares it received from UPDC to its shareholders, necessitating the COM to be held in a month’s time.

At the meeting to be held virtually at 10:00 am, shareholders would be expected to approve “the transfer of the units held by the company in UPDC REIT to the eligible shareholders of the company (as defined in the scheme document) based on the application of the allocation ratio as specified in the scheme document.”

Business Post gathered the transfer of UPDC REIT units to UAC shareholders will be implemented through a scheme of arrangement under Section 715 of the Companies and Allied Matters Act (CAMA), 2020 as amended, incorporating a reduction in share capital under Section 131 of CAMA (the Scheme). The effect of this is that the units of UAC in UPDC REIT will be transferred to shareholders, pro-rata to their shareholding in UAC.

If the scheme is approved and when it is implemented, UAC’s shareholders will hold UPDC REIT units in addition to their existing shares in UAC and UAC will cease to be a unitholder in UPDC REIT.

This means UAC will no longer be a direct shareholder in UPDC REIT but eligible shareholders of UAC will become the direct shareholder of UPDC REIT.

As a result, the share capital account of UAC will reduce by N3,896,355,966, being the value of the transferred units through the reduction of its share premium account and the share premium deduction amount shall be transferred into the UPDC REIT unbundling liability account.

UAC has said a day after the COM, it should file the resolutions with the Corporate Affairs Commission (CAC) and on October 20, the formal approval of the Securities and Exchange Commission (SEC) is expected to be obtained and on November 4, a sanction of the scheme should be obtained from the court, while a day after, the Certified True Copy (CTC) should be sent to SEC.

It stated that after the last trading day to qualify for the scheme (eligibility date) on November 8, it would register the CTC of the court sanction at the CAC on November 11 and the next day, this would be published in two national newspapers and on November 18, the accounts of the eligible shareholders would be credited with the corresponding number of shares and on November 22, the summary report would be filed with SEC.

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. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Economy

FBN Holdings Confirms Otedola as Shareholder with 5.07% Stake

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FBN Holdings

By Dipo Olowookere

Mr Femi Otedola now controls a 5.07 per cent stake in FBN Holdings Plc, the company has confirmed.

This is coming barely 24 hours after the financial institution said it was not aware of the businessman being a major investor in the organisation.

There were reports a day earlier that the former Chairman of the defunct Forte Oil Plc was now the single largest shareholder of the firm, which owns First Bank of Nigeria Limited.

“The attention of FBN Holdings Plc has been drawn to media reports today, October 22, 2021, purporting that a certain individual has acquired a significant shareholding interest in FBN Holdings Plc, therefore, making him the majority shareholder in the company.

“As a listed company, the shares of FBN Holdings Plc are publicly traded, and sale and acquisition of shares is expected in the normal course of business. We operate in a regulated environment, which requires notification of significant shareholding by shareholders to the company, where shares are held in different vehicles, further to which the company will notify the regulators and the public as appropriate.

“The company is yet to receive any notification from the individual mentioned in the media report, of such acquisitions.

“FBN Holdings Plc will always notify the appropriate agencies and authorities whenever it receives any notice of significant shareholding by the shareholders and the company’s registrars,” the statement released by the firm on Friday had stated.

But today, the company issued another statement, informing the investing public that Mr Otedola now owns 5.07 per cent of the company’s equities. This is coming after it was reported that he acquired N30 billion worth of FBN Holdings stocks on the Nigerian Exchange (NGX) Limited.

The financial institution said it received a notification today concerning this development.

“We refer to our communication to the market dated October 22, 2021, on the above subject wherein we stated that we would inform the public of any substantial acquisition, upon receipt of notification from the shareholder.

“This morning, October 23, 2021, FBN Holdings Plc received a notification from APT Securities and Funds Limited, that their client, Mr Otedola Olufemi Peter, and his nominee, Calvados Global Services Limited, have acquired a total of 1,818,551,625 units of shares from the company’s issued share capital of 35,895,292,791.

“Based on the foregoing, the equity stake of Mr Otedola Olufemi Peter and his nominee in the company is now 5.07 per cent,” the disclosure said.

Business Post reports that with this development, Mr Otedola will likely have one of two persons on the board of FBN Holdings to represent his interest. A change in the board of directors of FBN Holdings is likely to happen in the coming days, weeks or months.

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Economy

Buhari to Finally Launch eNaira October 25

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eNaira

By Dipo Olowookere

On Monday, October 25, 2021, President Muhammadu Buhari will formally launch eNaira, the much-awaited electronic Naira, the Central Bank of Nigeria has confirmed.

The digital legal tender for the country introduced by the CBN was initially scheduled for launch on October 1, 2021, but was shelved.

According to the apex bank, the botched introduction was a result of activities clashing with the event and in order not to let other events overshadow the eNaira launch, it was postponed indefinitely.

But on Saturday, the CBN announced next Monday as the new date for the introduction of the electronic currency under the Central Bank Digital Currency (CBDC).

A statement issued by the Director of Corporate Communications, Mr Osita Nwanisobi, disclosed that Mr Buhari will perform the formal launch at the State House in Abuja.

It was stated that after the event by the President, the eNaira, which has the theme Same Naira, more possibilities, will become available to Nigerians to use as it would be activated.

The CBN said a structure has been put in place to promptly address any issue that might arise from the pilot implementation of the eNaira, with room for further engagement with “various stakeholders.”

The bank said “the eNaira is a culmination of several years of research work” in advancing the “boundaries of the payments system in order to make financial transactions easier and seamless for every strata of the society.”

According to the central bank, it had robust discussions with “the banking community, fintech operators, merchants and indeed, a cross-section of Nigerians” concerning the eNaira and said it was satisfied with the outcome of the talks, stressing that the eNaira “marks a major step forward in the evolution of money” and would ensure that the digital currency, “like the physical Naira, is accessible by everyone.”

“Given that the eNaira is a journey, the unveiling marks the first step in that journey, which will continue with a series of further modifications, capabilities and enhancements to the platforms.

“The CBN will continue to work with relevant partners to ensure a seamless process that will benefit every user, particularly those in the rural areas and the unbanked population,” it added.

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Economy

Friesland Drowns Unlisted Securities Market by 0.33%

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Friesland WAMCO

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange closed in the negative territory at the last trading session of the week on Friday by 0.33 per cent.

It was the first time the market was closing bearish this week and this drowning of the unlisted securities market yesterday was caused by a decline in the equity price of FrieslandCampina WAMCO Nigeria Plc. The price of Friesland went down by 6.7 per cent or N8 to settle at N120.00 per share in contrast to N128.00 per share of the last session.

As a result, the market capitalisation of the exchange dropped N2.04 billion to close the day at N617.59 billion in contrast to N619.63 billion it finished on Thursday.

In the same vein, the NASD Unlisted Security Index (NSI) depreciated by 2.47 points to wrap the session at 747.53 points compared with 750.00 points of the previous session.

Despite the loss recorded yesterday, two securities closed in the positive region led by Central Securities Clearing Systems (CSCS) Plc, which rose by N1.15 or 6.4 per cent to close at N17.95 per unit versus the previous N16.80 per unit.

Also, NASD Plc appreciated during the session by 5 kobo or 0.37 per cent to quote at N13.70 per share as against the N13.65 per share it traded at the preceding session.

At the market on Friday, a total of 292,000 units of securities were transacted by investors in contrast to the 209,300 units of securities transacted at the previous session, indicating a rise of 6.1 per cent.

Equally, the value of shares exchanged by the market participants went up by 14.7 per cent to N4.9 million from N4.3 million recorded at the previous session.

These transactions were carried out in five deals, 16.7 per cent lower than the six deals carried out at the preceding session.

Food Concepts Plc was the most active stock by volume (year-to-date) as it has traded 11.4 billion units of its shares for N14.4 billion. Lighthouse Financial Services Plc occupied the second spot as it has traded 1.1 billion valued at N546.1 million, while Geo Fluids Plc took third place with 1.0 billion units worth N700 million.

In terms of value, Food Concepts Plc also topped the chart with 11.4 million units traded for N14.4 billion, Nigerian Exchange (NGX) Group Plc remained in the second spot with 456.4 million units valued at N9.2 billion, while VFD Group Plc maintained the third spot with 10.4 million units valued at N3.5 billion.

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