Subscription for Transcorp Hotels Rights Issue Opens

By Dipo Olowookere

Shareholders intending to take their rights in the N10 billion rights issue of Transcorp Hotels Plc can begin to do so as the subscription has opened.

Application for the exercise officially started on Monday, October 5, 2020, and will run till Wednesday, November 11, 2020.

During the rights issue, the hospitality giant hopes to sell a total of 2,659,574,468 ordinary shares of 50 kobo each at a nit price of N3.76 to shareholders.

This offer is for shareholders who held stocks of the company as at the close of business of Monday, July 13, 2020, though other interested investors can subscribe by getting in touch with their stockbrokers.

The firm plans to raise about N10 billion from the rights issue, which would be ploughed back into the company for its operations.

During the sales, Transcorp Hotels will be offering to subscribers a total of seven new ordinary shares of the company for every 20 ordinary shares held by shareholders.

Business Post reports that these new shares to be sold in the rights issue would be issued from the authorised share capital of the company, which is currently at N7.5 billion comprising 15.0 billion ordinary shares of N0.50 each, and the resultant issued and fully paid-up share capital will be N5,129.989.184 consisting of 10,259,978,368 ordinary shares of N0.50 each.

Transcorp Hotels Plc owns the iconic Transcorp Hilton Abuja and Transcorp Hotels Calabar.

The company, like every other in the sector, has been badly hit by the COVID-19 pandemic and recently, the management announced that it was cutting its workforce by 40 per cent, while its senior executive management team will get a pay cut.

“Our workforce headcount will be reduced by at least 40 per cent, and our reward system will be optimised,” the MD/CEO of Transcorp Hotels, Mrs Dupe Olusola, said recently.

According to her, “The slow pick up of international travel, restriction on large gatherings, the switch to virtual meetings and fear of the virus, has drastically reduced demand for our hotels and occupancy levels to its lowest of less than 5 per cent.”