Economy
Uduk Describes Private Equity Firms ‘Agents of Economic Growth’
By Modupe Gbadeyanka
Private equity companies have been described as important agents of business and economic growth because they bring capital to business.
The Acting Director General of the Securities and Exchange Commission (SEC), Ms Mary Uduk, who said this at a programme in Lagos over the weekend, said PE firms have various businesses opportunities they can tap into.
The SEC chief, speaking at the Udo Udoma & Belo-Osagie (UUBO) second private equity summit with the theme Drivers, Disruptors and Unlocking Value, noted that there was a nexus between adequate capital and business growth as such capital helps businesses grow, generates profits for the investors, creates socio-economic benefits to the consumers, and enhances overall growth of the economy.
PE can look into lots of startups in the country with robust business plans, many profitable unlisted companies with established cash-generating capacity, as well as public companies with solid customer bases, proven products, and high-quality management.
“I see an improved investment climate, friendly market rules and regulations as well as increased investor education as essential elements for attracting PE investments in Nigeria.
“Towards this, the commission is working on rules and regulations to ease participation of, and disclosures, by more PE funds. Initiatives in registering and developing the FinTech space in the capital market will also provide good opportunities for PE firms to invest in innovative start-ups operating in in the capital market.
“The ISA 2007 empowers the Securities and Exchange Commission to register PE Funds. Based on their scope and the need to attract investors such as the Pension Funds, many PE firms and Infrastructure funds (often structured as PE), file their returns with the commission,” Ms Uduk said.
She said the capital market provides the most efficient gateway opportunities for PE firms, citing the NASD Enterprise Portal as a collaborative development in the market, which aims at aiding PE firms invest in and dispose of eligible companies’ securities in an easy and cost-effective manner.
According to her, “As PE activity rises in the country, PE funds can utilise the opportunities provided on our various organised exchanges when exiting their investments. This will increase the quality of our listed public companies, while allowing PE firms benefit from the market liquidity, efficiency and increased participation available on the exchanges.”
“It is therefore, my hope that the outcome of this summit will impact greatly and positively on the PE segment of our market, the capital market in general and our economy as a whole,” she said.
In his keynote address on Fostering an enabling environment for investment in Nigeria, Minister of Industry, Trade and Investment, Mr Niyi Adebayo, said federal government would seek to localise at least 40 percent of its expenditure on stipulated goods and services, to facilitate local markets access for Nigerian made products.
The Minister said that government had realised that building production capacity alongside strategic partners with strong track record in some priority sectors was critical to success.
“Through the Nigerian Investment Promotion Commission, bilateral investment agreements are being modernised with a greater sense of purpose.
“Much of our most recent agreements target countries that align with our ambition of building local production capacity,” he said.
According to him, government will seek a comprehensive approach in mobilising capital, incentivising priority sectors and expanding market access for local producers.
Mr Adebayo said that government would further enhance the ease of doing business and support the growth of MSMEs.
He said that the ministry had begun implementing a number of key initiatives, including the reactivation of the six special economic zones and the special agro-industrial processing zones project.
“In supporting the growth of MSMEs, we are easing access to capital, deploying shared facilities across the country and facilitating the delivery of tax and regulatory incentives for MSMEs.
“Our priority sectors cut across agriculture, construction and the automotive industry,” Adebayo said.
He said that Nigeria would remain critical to the global economic market as the country prepared for the inevitable rise of the world’s third most populous country.
“This also presents a compelling case for global investors when viewed against the backdrop of the country’s capacity for growth.
“Achieving a GDP per capita rate comparable to South Africa would catapult Nigeria’s GDP to over one trillion dollars.
“The dwindling prospects of oil and our growing population leaves us with no choice but to develop a Nigeria that is investor-friendly, export-oriented, high producing and high growth,” Adebayo said.
He said that government’s primary objective in the present decade was economic diversification and job creation.
“Diversification of our economy, or more precisely government revenues, must accommodate both short and long-term efforts because we no longer have the luxury of time; considering the realities of our growing population and the dwindling prospects of crude oil,” Mr Adebayo said.
Founder of Counsel UUBO, Mr Udoma Udo Udoma, stressed the need for private sector participation in the development of the country’s economy.
Mr Udoma said that government must engage private sector to ensure economic expansion, noting that government could not do it alone, adding that government needed to create an enabling environment that encouraged growth of private equity in Nigeria.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.65 per cent gain on Friday, December 13, boosted by three equities admitted on the trading platform.
On the last trading session of the week, Okitipupa Plc appreciated by N2.70 to settle at N29.74 per share versus Thursday’s closing price of N27.04 per share, FrieslandCampina Wamco Nigeria Plc added N2.49 to end the session at N42.85 per unit compared with the previous day’s N40.36 per unit, and Afriland Properties Plc gained 50 Kobo to close at N16.30 per share, in contrast to the preceding session’s N15.80 per share.
Consequently, the market capitalisation added N6.89 billion to settle at N1.062 trillion compared with the preceding day’s N1.055 trillion and the NASD Unlisted Security Index (NSI) gained 19.66 points to wrap the session at 3,032.16 points compared with 3,012.50 points recorded in the previous session.
Yesterday, the volume of securities traded by investors increased by 171.6 per cent to 1.2 million units from the 447,905 units recorded a day earlier, but the value of shares traded by the market participants declined by 19.3 per cent to N2.4 million from the N3.02 million achieved a day earlier, and the number of deals went down by 14.3 per cent to 18 deals from 21 deals.
At the close of business, Geo-Fluids Plc was the most active stock by volume on a year-to-date basis with a turnover of 1.7 billion units worth N3.9 billion, followed by Okitipupa Plc with the sale of 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 million.
In the same vein, Aradel Holdings Plc remained the most active stock by value on a year-to-date basis with the sale of 108.7 million units for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with a turnover of 297.3 million units worth N5.3 billion.
By Adedapo Adesanya
The Naira appreciated further against the United States Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N1.50 or 0.09 per cent to close at N1,533.00/$1 on Friday, December 13 versus the N1,534.50/$1 it was transacted on Thursday.
The local currency has continued to benefit from the Electronic Foreign Exchange Matching System (EFEMS) introduced by the Central Bank of Nigeria (CBN) this month.
The implementation of the forex system comes with diverse implications for all segments of the financial markets that deal with FX, including the rebound in the value of the Naira across markets.
The system instantly reflects data on all FX transactions conducted in the interbank market and approved by the CBN.
Market analysts say the publication of real-time prices and buy-sell orders data from this system has lent support to the Naira in the official market and tackled speculation.
In the official market yesterday, the domestic currency improved its value against the Pound Sterling by N12.58 to wrap the session at N1,942.19/£1 compared with the previous day’s N1,954.77/£1 and against the Euro, it gained N2.44 to close at N1,612.85/€1 versus Thursday’s closing price of N1,610.41/€1.
At the black market, the Nigerian Naira appreciated against the greenback on Friday by N30 to sell for N1,650/$1 compared with the preceding session’s value of N1,680/$1.
Meanwhile, the cryptocurrency market was largely positive as investors banked on recent signals, including fresh support from US President-elect, Mr Donald Trump, as well as interest rate cuts by the European Central Bank (ECB).
Ripple (XRP) added 7.3 per cent to sell at $2.49, Binance Coin (BNB) rose by 3.5 per cent to $728.28, Cardano (ADA) expanded by 2.4 per cent to trade at $1.11, Litecoin (LTC) increased by 2.3 per cent to $122.56, Bitcoin (BTC) gained 1.9 per cent to settle at $101,766.17, Dogecoin (DOGE) jumped by 1.2 per cent to $0.4064, Solana (SOL) soared by 0.7 per cent to $226.15 and Ethereum (ETH) advanced by 0.6 per cent to $3,925.35, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
By Dipo Olowookere
For the fourth consecutive trading session, the Nigerian Exchange (NGX) Limited closed higher on Friday by 0.63 per cent on sustained renewed buying pressure.
Apart from the energy and industrial goods sectors which closed flat, every other sector ended in the green territory, according to data obtained from the bourse.
Business Post reports that the insurance index appreciated by 1.52 per cent, the banking space improved by 0.63 per cent, and the consumer goods counter expanded by 0.46 per cent.
As a result, the All-Share Index (ASI) gained 617.47 points to settle at 99,378.06 points compared with the preceding day’s 98,760.59 points and the market capitalisation went up by 375 billion to close at N60.242 trillion, in contrast to Thursday’s closing value of N59.867 trillion.
The volume of transactions on Customs Street yesterday grew by 11.13 per cent to 544.2 million shares from the 489.7 million shares transacted a day earlier.
The value of transactions increased during the session by 49.30 per cent to N10.6 billion from N7.1 billion and the number of deals went up by 1.93 per cent to 8,464 deals from the 8,304 deals posted in the previous trading session.
The busiest equity for the trading day was Japaul with the sale of 71.7 million units valued at N158.0 million, eTranzact exchanged 70.7 million units worth N477.5 million, Tantalizers sold 57.3 million units for N101.2 million, FCMB traded 33.0 million units worth N297.3 million, and Universal Insurance transacted 27.1 million units valued at N9.6 million.
A total of 36 stocks ended on the gainers’ chart, while 15 stocks finished on the losers’ table, indicating a positive market breadth index and strong investor sentiment.
The trio of Aradel Holdings, Ikeja Hotel and Caverton gained 10.00 per cent each to trade at N550.00, N8.80, and N1.98, respectively, as Africa Prudential rose by 9.87 per cent to N17.25 and Golden Guinea Breweries soared by 9.64 per cent to N8.64.
On the flip side, Austin Laz lost 10.00 per cent to close at N1.62, ABC Transport crashed by 8.00 per cent to N1.15, Royal Exchange slumped by 7.69 per cent to 60 Kobo, Secure Electronic Technology plunged by 5.26 per cent to 54 Kobo, and The Initiates crumbled by 4.26 per cent to N2.25.
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