Nipco launches $16m offer for Mobil Oil shares

’Femi Asu with agency report

Nipco Plc has launched a N4.84bn offer for the shares it needs to take its stake in Mobil Oil to 70 per cent to comply with Nigerian takeover rules, its advisers said on Wednesday.

Nipco’s investment subsidiary bought 60 per cent of Mobil Oil Nigeria from Exxon Mobil Corporation in October, when the US giant pulled out of downstream fuel distribution in Nigeria.

Nipco, which was founded in 2001, now owns 66.7 per cent of the fuel retailer, according to an offer document seen by Reuters.

It is offering minority shareholders N417.12 per share for the 3.23 per cent of the capital, or 11.6 million shares, it needs, the same price it paid Exxon last year and a 75 per cent premium to Wednesday’s market price of N238.36.

The offer ends on June 29.

Shares in Mobil Oil have lost 10 per cent this year, giving the company a market value of N85.95bn. The shares rose 74 per cent last year.

The downstream oil industry in Nigeria is consolidating as multinational oil firms divest to focus on upstream exploration with higher margins, especially given the backdrop of lower crude prices.

Nigeria exports nearly two million barrels of oil a day but imports the bulk of its refined products because its refining capacity is unable to meet the country’s daily fuel needs of 40 million litres.

Mobil Oil rival, Oando, has now shifted away from being a fuel distributor to explore for oil and gas. It sold a 60 per cent stake in its downstream business last year to Vitol and Helios Investment Partners for $210m.

Nigeria, others face new era as MSCI review looms

’Femi Asu with agency report

 The stock markets of the world’s developing economies including Nigeria are about to undergo a kind of a revolution.

As index provider MSCI Inc. prepares to carry out its annual review in June, some of the world’s biggest and best-performing equity markets – with assets totalling almost $9tn – are poised for reclassification.

Countries including Pakistan, Saudi Arabia, South Korea, China, would be affected by the review, according to Bloomberg.

Nigeria, which is struggling to restore investor confidence in its currency, has seen its benchmark stock index lose more than 30 per cent in dollar terms over the past 12 months.

The MSCI is considering whether to downgrade Nigeria from a frontier nation to a standalone market.

Investors are giving a thumbs up for a foreign-exchange window that started in April, which allows them to repatriate funds or value their naira holdings at rates more closely aligned to the informal market. A United States’ exchange-traded fund focusing on Nigeria has seen inflows after the start of the new mechanism.

Investors are now making a case for MSCI to use the price of the naira on the window to value stocks instead of the tightly controlled interbank rate.

BlackRock Inc., Allan Gray Ltd. and Frontaura Capital LLC have already started using the new rate.

“Using the official rate means that MSCI is overstating year-to-date performance of their Frontier Market Index by about one percentage point,” said an analyst at Frontaura, Tom Egbert.

Ex-Barclays boss targets 44.5% stake in Union Bank

Oyetunji Abioye

A former Managing Director of Barclays Bank PLc, Mr. Bob Diamond, has agreed to sell more than a third of Atlas Mara, the vehicle he created to invest in banks in Africa including Nigeria.

He will sell the stake to the Canadian life insurer Fairfax Financial at an 80 per cent discount to its 2013 listing price.

The deal, which will partly fund Atlas Mara’s investment in the Union Bank of Nigeria Plc, may leave existing investors in the London-listed vehicle facing painful dilution, including Janus Capital, Wellington Management, Guggenheim and Diamond himself.

Specifically, Atlas Mara will use some of the money to increase its holding in Union Bank.

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It intends to pay $55m for an indirect 13.4 per cent shareholding in UBN, taking its combined direct and indirect holdings in the bank to 44.5 per cent, according to a Financial Times report.

A Union Bank spokesperson, Ogochukwu Ekezie, said the lender was going through regulatory approvals and would then start the share sale.

Atlas said on Tuesday that it would raise $100m through an offering of new shares, which would be sold at $2.25—a 10 per cent discount to Tuesday’s closing price—and a further $100m through the issuance of a mandatory convertible bond to Fairfax.

Fairfax, which is run by Canadian investor Prem Watsa, will also have the right to secure a minimum of 30 per cent of the share offering, and will subscribe for any shares not taken up by existing shareholders.

The Canadian group is expected to have a total shareholding of at least 35 per cent of Atlas Mara after the deals are completed, and will nominate four directors to its nine-strong board.

The deal will make Fairfax Africa, a new Africa-focused fund set up by the Canadian insurer, the biggest shareholder in Atlas Mara.

“A strategic partnership with Fairfax Africa creates a strong relationship between two like-minded, long-term investors in Africa,” Atlas Mara said. “Each is focused on capitalising on the long-term growth potential of Africa and provides permanent capital to support growth.”

The new share offering came shortly after Atlas Mara was forced to raise extra funds in an overnight placing in February.

The vehicle has had a difficult year, which also saw the departure of its chief executive, a drop in profits and the announcement of a big reorganisation and cost-cutting programme.

However, Diamond, who chairs the group, is aiming to double Atlas Mara’s earnings in the coming year.

WAPCo eyes gas supply from Lagos oil field

’Femi Asu

The West Africa Pipeline Company Limited has said it is looking to capture new gas supply from Nigeria, with a focus on the Aje field offshore Lagos, as part of its key interventions to reposition the company for the dynamic market landscape.

WAPCo is the operator of the $1bn West African Gas Pipeline, which was built to supply natural gas from Nigeria to customers in Benin, Togo and Ghana.

The Managing Director, WAPCo, Mr. Walter Perez, who spoke in Lagos at a business forum organised by the Nigerian Gas Association, said the company was also seeking increased supply from the Escravos-Lagos Pipeline System.

He disclosed that the transition to a bi-directional pipeline system from a uni-directional system was meant to increase capacity and accommodate new entry points amid significant unmet demand along the WAGP market.

He said the growing market in the sub-region had seen Ghana, Togo, and Benin compete with Nigeria domestic gas market for new Nigerian supply.

According to Perez, there is an increasing appetite for natural gas as a cleaner energy source but significant supply gap still exists, increasing attention towards Liquefied Natural Gas.

He said steps to reposition WAPCo for the dynamic market landscape included the facilitation of multiple shippers operating under the open-access regime; diversification and attraction of new robust supply; adaption of the WAGP configuration to reflect changing supply and demand patterns, and transition from single postage stamp to a more robust and flexible tariff structure for the WAGP by January 1, 2019.

He said the company would attract substantial gas supply from western Ghana, as well as capture re-gasified LNG for transport through the WAGP.

“WAPCo is adapting its business model to suit market dynamics; transitioning to bi-directional, multi/entry exit system, and offering a competitive tariff to attract new gas volumes,” Perez said.

Yinka Folawiyo Petroleum Company Limited, a wholly-owned indigenous firm, is the operator of OML 113, where the Aje field is located.

Other partners are Panoro Energy, New Age Exploration Nigeria Limited, EER (Colobus) Nigeria Limited and PR Oil & Gas Nigeria Limited.

It was gathered in December that the partners had planned to embark on a work programme that would increase oil production and reserves from the field through drilling of new wells, and were working on an Aje gas field development plan for the phase 3 Turonian gas development with first gas production anticipated by the first half of 2018.

One of the partners, Panoro, said then that a third Turonian gas condensate development phase was being conceptualised and would likely involve three or four wells producing over 500 billion cubic feet of gas, 22 million barrels of condensate and 40 million barrels of liquefied petroleum gas.

Aje is an offshore field located in OML 113 in the western part of Nigeria in the Dahomey Basin.

It contains hydrocarbon resources in sandstone reservoirs in three main levels – a Turonian gas condensate reservoir, a Cenomanian oil reservoir and an Albian gas condensate reservoir.

Investors lose N311bn, NSE reviews market indices

’Femi Asu

 The equities segment of the Nigerian Stock Exchange pared some of its recent gains on Wednesday, with investors losing N311bn in value on the back of losses by 37 firms led by PZ Cussons Plc.

The NSE All-Share Index fell by 2.61 per cent to close at 33,477.89 basis points, while the market capitalisation of listed equities dropped to N11.576tn from N11.887tn on Tuesday.

PZ Cussons and Skye Bank Plc saw their share prices decline by five per cent each to close at N20.90 and N0.76, respectively.

Cadbury Nigeria Plc shed 4.98 per cent to close at N13.54 per share, while Ecobank Transnational Incorporated and Oando Plc dropped by 4.97 per cent each to close at N14.53 and N7.27 per share, respectively.

The share prices of FBN Holdings Plc and Fidson Healthcare Plc dipped by 4.95 and 4.78 per cent respectively to close at N6.34 and N2.99.

Thirteen stocks recorded price increase on Wednesday, with Neimeth International Pharmaceuticals Plc leading the park.

Neimeth International Pharmaceuticals rose to 9.09 per cent to N0.84 per share, while Conoil Plc gained 4.99 per cent to close at N40.42 per share.

Cement Company of Northern Nigeria, Vitafoam Nigeria Plc and Honeywell Flour Mills Plc appreciated by 4.93 per cent, 4.8 per cent and 4.79 per cent, respectively, to close at N11.27, N2.84 and N1.97 per share.

 A total of 508.732 million shares worth N6.396bn in 5,876 deals were traded by investors on the floor of the Exchange on Wednesday.

Meanwhile, the NSE, on Wednesday, announced the expected review of the NSE 30, and the bourse’s six sectoral indices, namely, NSE Consumer Goods, NSE Banking, NSE Insurance, NSE Industrial, NSE Oil & Gas and the NSE Lotus Islamic Indices.

The indices are normally reviewed bi-annually (June and December) except for NSE Pension index that is reviewed once in the year (December).

 “With the review, we will witness the entry/re-entry as well as exit of some major companies. The composition of these indices after the review will be effective on July 1, 2017,” the NSE said.

According to a statement, the NSE-30 and NSE Industrial Indices are modified market capitalisation index with the numbers of included stocks fixed at 30 and 10, respectively, with the stocks selected based on their market capitalisation from the most liquid sectors.

The liquidity is based on the number of times the stock is traded during the preceding two quarters, and the stock must have traded for at least 70 per cent of the number of times the market opened for business in order to be included,

“The Exchange is aware that the number of the stocks included in some of the indices may not be practically suitable for optimal portfolio diversification; however, the numbers would be reviewed as sector conditions change,” it said.

Can one person close a joint account?

If you are in a committed relationship, you might think about merging your finances and opening a joint bank account. It can make sense if you live and pay bills together – it might be easier to have the money coming out of one account, according to www.thinkmoney.co.uk.

But if you want to close the joint account for some reason, how do you go about it? Will you both need to do this or can just one person close the account?

Splitting up: Going through a break up or a divorce can be tough and there is usually quite a lot to deal with. But once you have sorted out what is happening with your house and all the bills, you will need to decide what to do with your joint account.

It is important that you do this together as the money in the joint account belongs to both of you. One of you can’t close the account on their own until you have decided who gets the money.

If you are worried about your partner having access to shared money, you can speak to your bank or account provider and ask them to freeze your account. This means that neither of you will be able to take any money out.

However, this is obviously a short-term problem, as at some point, you will want to get to this. Speak to your ex and decide together who will get the money. If you can’t agree, you can get the courts to decide for you – although you will have to pay for this.

Make sure that you don’t close the account before you have set up direct debits to pay off any debts or other existing financial agreements. Just because you have split up, it doesn’t mean you don’t owe the money anymore.

If your partner passes away, it’s likely that your bank account will be the last thing on your mind. But at some point, you will need to contact your bank or account provider and get it switched to a single one. You should get your late partner’s name taken off the account.

Things to know before closing a joint bank account

With  Nike  Popoola

Many people have joint bank accounts for convenience, but there are risks, too. Generally, the law does not care who started the account or who contributed more. In a joint bank account, the two parties are 100 per cent owners of the account; and that creates two risks, according to http://www.creditcards.com.

First, anyone on a joint account can withdraw all of the funds in the account without the other person’s knowledge. So, your former significant other could clean you out in one transaction!

Second, creditors of any account holder can access all of the funds in the account to settle debts owed by either party. Therefore, if your ex is a deadbeat, you can expect creditors to attempt to collect from your joint account. Moreover, as far as the law is concerned, the money is his and should be available to cover the debts.

The best way to avoid problems is to close the account and divide the assets. Since the asset belong to both people, either party in a joint savings account may withdraw the finds.

It should be simple and easy, but it is not always the case. While it is true that either party can close the account, some funds, such as inheritances, are legally distinct. The bank may let you close a joint savings account and take the other person’s inheritance, but that act could open yourself up to lawsuit or possibly fraud charges.

Also, banks usually require you to show up in person to close a savings account. If you have split and moved to another area, that is going to impose a hardship.

Closing credit card accounts can be more troublesome, especially if you owe money on the account. If you carry a balance on your credit card accounts, it is certain you will have trouble closing the account. That is because the bank wants to keep both of you responsible for the debt. Even if you never used the card, legally, the money was loaned to both of you. As a result, the bank would want to be able to collect from either of you if that becomes necessary.

The best strategy is to pay off the account completely and then close it. Often, repaying a debt when you are in the middle of a divorce is hard to do. One solution would be for each of you to open new individual balance transfer account and move a portion of the debt to that account. When the joint account has a zero balance, close it.

If a divorce is involved in your breakup, your divorce agreement may call for your former mate to make certain payments. But that doesn’t necessarily mean that they will. The world is full of divorced people who can’t or refuse to pay debts to their former spouse.

It is true that you have the right to take them back into court. But that can be expensive and probably won’t solve the problem if they don’t have the money.

Bottom line is that it will be very difficult to close a joint credit card account if there is a balance due, but you can change the account status so that no additional charges can be made on the account. Do so formally at the account level by contacting the number on the back of the card. As a practical measure, having both partners cut up their cards would also help prevent mischief, accidental or otherwise.

And, while you are separating your finances, don’t forget to change your beneficiaries on your retirement accounts and life insurance policies. They are easy to overlook. You will also need to update your will.

Breaking up can be devastating emotionally. But if you don’t take proper precautions, it can be just as damaging financially.