₦airaland Forum

Kobojunkie:
^^^^ A Vote for your beloved Jonathan is a vote not just for IBB, but for Obasanjo,IBB, Saraki and for PDP to continue to pillaging . It is clear as day at this time in the day that our beloved Jonathan is not here to get rid of the old criminals . . . it almost seems he does not even care as long as he is maintained.  So before you or any other Nigerian out there decides to cast that vote, I suggest you please think deeply about the implications of such an action on the future of your Nation.

better run, cos Beaf is coming after you for speaking the truth in such clear and concise manner.

mikeansy:
I hope the person you are talking about is not Jonathan because he has no roadmap to anything yet. All he said was he will promise less and do more.

And he has started by setting the lowest standard of promising nothing so that no matter how little he does in the next 4 years he would have done more. Hence keeping his dodgy promise of promising less and doing more.

He simply told Nigerians on wednesday that he plans to make up his policies as we go along.

for saying that, you must be an IBB supporter, you know how that logic works?

mikeansy:
I am not talking about detailed plans here, but he could have been able to demonstrate mastery of general issues.

His responses were not very tact either. It is a very poor interview generally.

extremely poor interview.
the whole thing sounds fishy.he does not even belong to a political party yet.
what is it with all these men?
they have nursed an ambition for years, yet no clear cut plan or agenda of how to use the power to effect change.
Just the same old rhetoric, four months to the election.
are they waiting for an angelic visit before they have a clear vision?

his comments sound fishy.
I am very sceptical of his intentions.

yemmight:
State of emergencies in both Ogun and Oyo is urgently required but I trust these PDP people they rather allow pple die than declaring state of emergency.

it is a family affair.they will settle it internally, as usual.

beaf,can't you just make your points without all these childish insults?
stop trying to defend the indefensible.
the truth is that these governors are taking advantage of the situation on the lack of strong leadership at the centre.
All GEJ is concerned about at present is getting support by all means.
it does not matter whether half of Abia and Imo state are kidnapped or if a theatre of killings is unleashed in Ogun and Oyo states, as long as the governors deliver the needed votes, all is well.

Jarus:
My oga, at last you have someone. 

yes o!
i have not read him in a while read him recently and remembered why i first fell in love with his writings.
he could be too intellectual at times for me but the fact that he is not a journalist (presently) makes me warm up to his writings.

tpiah:
are all these stories real or exaggerations?

just wondering.

I had the same questions until i visited the south east recently, half of the kidnapping stories are not even told.
imagine where someone goes to visit his family in Aba or neighbouring town and parks his car in PH or calabar and goes with public transport to Aba, in order to avoid attention and possible kidnap?

Jarus:
I think we are treating the issue of kidnapping with kid glove. More stern measures just need to be applied. This is getting too much.

Mbulela, long time, hope you're doing good?

my brother, i am fine.How work?
take care o!

Ikengawo:
yeah cause he's the one that killed he man right?
ape.

is that really the best insult you could come up with?
you really need to try harder or better still try someone else as i am not in that league of trading insults online.
the president needs to sit up and address this issue of kidnapping.It is fast enveloping the entire country.
In the absence of security, we have nothing left.
The man seems to be spending all his time politicking and campaigning on FB.
Playing politics with this kidnapping thing is akin to mass suicide and i can't see any tangible effort in arresting the menace.

ike okonta

mikeansy:
Buhari does not even deserve to run a countrty in the mold of Iran or Afghanistan let alone a very complex country like Nigeria.

Bros, Afghanistan is a rough and complex place o!

marvix:
@Mbulela, does sacking the head of an anti corruption agency because people who dont even understand the workings of the agency say so shows that the president is performing, look at it this way Pilate listened to the people and crucified an innocent man and release a thief.
So Jonathan not listening to noise been made by Nigerians who dont understand the role of the EFCC in a democracy can not be a draw back for him.

I feel very disappointed when educated men like you sound uneducated, do you really think that buying three presidential jets can hinder the salary hike, come to think of it,if it is the money to be used in purchase of jets that would be used to implement the salary raise then we can as well forget it because that amount can not take the salary raise for six months.
All I am trying to say is that a budget for one item should not be seen as a hindrance to another, just like Jonathan has said the salary hike is in the supplementary budget and once passed by the senate the workers would be paid in Arrears from July.
If we must grow we must stop this local mentality that because a govt spends on defence, education must suffer, that is what Yaradua preached in his 7point agenda.

Building institutions is more important than any other thing in a nation.

Dimeji Bankole is not Goodluck Jonathan!!!

you might sound educated but your arguments are never convincing and always seem all over the place.
Dude, you do not waste money buying three presidential jets in the face of more pressing problems in the country.
who complained about spending money on defence?
why can't he fly commercial airlines?
David Cameroun flies commercial, after all.
buying three jets smacks of insincerity in the present clime.
it is in the same class of sin like those barbarians in the NASS increasing their quarterly legal loot.
What institution is Jonathan building?

^^^
Jonathan epitomises the same old medocrity and cluless leadership that this country has been saddled with over most of the last 50 years.
According to Mr. Goodluck ", to tell you the truth at all times, to carry you along and most importantly to listen to you, " If Jonathan is so down-to-earth with humility, he should listen to Nigerians and stop the purchase of three presidential jets in the face of dire poverty. Using part of the money to pay Nigerian workers. Workers have been whispering to the president to pay up the new salary increment he hiked up lately with inception from 1st July. A leader who has sound emotional intelligence and listens to Nigerian workers would not wait until workers start shouting before he takes action. Nigerians in their churns have been screaming for the sack of Farida Waziri from EFCC, but the president keep looking the other way. We warned the president then, not to give National Honours to criminal Adams and Eves in Nigeria. But he downplayed our collective importance, by tagging us as the insignificant others and went on to dole honours to those who're not due. Nigerians would be naive to believe that Jonathan who refused to hearken to them as a short-time president, would listen to them when he is given four full years to rigmarole and knock-about in world capitals.young or old,is irrelevant.what we need is purposeful leadership that will lead this country along a path of drastic change.
the juncture we find ourselves is too critical for the usual crap.

all this talk about young generation is irritating.after all Dimeji Bankole is young and he is no better than the old thieves.

CLASSIFYD:
Dbanj music has always been wack! He's been hiding under don jazzy's productions,his attitude nd stage performance.

ha ha ha ha

Short black boy, perform.
your girl want ipad o!

meanwhile GEJ is busy campaigning on Facebook.

Finally, a real man has spoken.
unfortunately, Buhari will not win for obvious reasons.

AjanleKoko:
I'll give you a good example. Where I used to work, there was this guard that was always sleeping on duty. I once asked him what the issue was, and he said he lived in a room with two wives and eight children, and was hardly ever able to get any rest. Now for such a character, would you say it was fear of the unknown that kept him stuck in a guard job, with two wives and eight children?

na fear of the unknown jare!
dude was not sure one wife would give him the eight children he needs as insurance for old age.
so he married two.
if they had not given him 8 kids early enough he would have married a third one.

AjanleKoko:
It was my wife that mentioned it, actually. I think maybe she saw that JB sign you're referring to.

I usually go into Phase 1, drive to the end of Admiralty, and get back on the road where you have TPH. I turn off at the entrance to Prime Water View Estate (a very bad road), and get into Ikate from there. The traffic is so bad now that i avoid the expressway entirely.

A friend at Still Waters told me they engaged LCC to break the road just before the Spar junction, and create a small roundabout or U-Turn, so that they won't have to drive all the way to 3rd roundabout in the morning. That's good news for me long-term!

what is the state of that end of Admiralty road? the part leading to TPH?
it was horrible the last time i was there (that was a while sha)

if we don't believe Dokpesi, is it IBB we will believe?
funny barbarians

Sagamite:
Didn't you note the[b] retarded publication[/b] that he sourced the news from?

They are the ones that titled it like that.

gbam!

Ranoscky:
Nigeria with dia kuru-kere way of dealin with 1 another.

gbam!!
the boldness of the thieving party is enough to intimidate the just and make them look like the guilty party.
we might never know the truth.

beaf, kindly send me membership forms for the GEJ solidarity group.
I'll rather make GEJ a life president than vote for Odili.
Odili is the lowest of lows.

^^^
i agree with you.
my problem is this tendency of painting any one who does not hop on the GEJ bandwagon an IBB fan.

dude, you are getting carried away with this your Jonathan sycophancy.
try and take it easy.
Everybody that dislikes Jonathan is not an IBB lover.
i dislike IBB more than Jonathan but that does not change the fact that this country can do way better than GEJ.
dude is a mediocre and an opportunist.
This is a critical juncture in the life of this country and we need capable hands not a man that has no track record and no discernible ideology.
some of us just have a disdain for mediocrity and crass opportunism.we are no fans of IBB or even Atiku.
Pls take it easy.

By Olu Jacob
September 12, 2010 11:49PM
http://234next.com/csp/cms/sites/Next/Opinion/5618222-146/jonathan_is_not_the_one_.csp


While President Goodluck Jonathan plays Hamlet, others are not so coy. His former boss and mentor, Diepreye Alamieyeseigha, who said, “he calls my wife mummy and my wife takes him as a son,” warned that if Mr. Jonathan does not run, “the Ijaw man will be disappointed. This is not a threat; we shall wait for him to come home. So let him listen to us as his people.” Anyway, it is almost certain that the president will run. Aides hint that an announcement will come after Ramadan, and his wife, Patience, was not too subtle when she visited Delta State recently. “If you love my husband, then go and register so you can vote.” They say she is the ‘real’ politician in the family so emissaries from Bayelsa State, led by the speaker, Werinipre Seibarugu, went to plead with her to forgive the state governor, Timpreye Sylva, for failing to fall behind her husband fast enough. According to reports, “though she is still angry, feelers indicate that she is already reconsidering her stand against the governor.” So run Mr. Jonathan will, for a rash of reasons, and pressure so unreasonable he could claim, like Tony Blair, “I can only go one way. I have not got a reverse gear.” Besides, said Cairo Ojougboh, his special adviser on National Assembly matters who first broke the news, “there is no moral justification to ask Jonathan not to run.” There is no moral justification for him to run either. He cannot claim that he is the best candidate for the job; that he has the will and wherewithal to solve our economic and social problems; that he could superintend free and fair elections while running his first presidential campaign; that his anti-corruption war is not circumscribed by the charge that his wife was caught trying to launder 13.5 million dollars. Or even that his candidacy will not deepen the schism within the polity, making the north feel short-changed, betrayed.

“What that will create is a serious problem in the future,” said Audu Ogbe who chaired the 2002 meeting where 47 PDP chieftains (two abstained) voted for zoning to allow the south complete an eight-year tenure. “Because if it means ‘when we have it, we keep it, it can’t move’ then a suggestion is being made to the northerners that ‘you’re a bunch of fools for agreeing to do it in the first place.’” Besides, since he became president, Mr. Jonathan has not ruled with any vigour, nor shown the ability to bring new ideas or people to bear on perennial problems. Even now, one gets the sense that he is being told to run simply because he can, because he is there now and it is ‘their’ turn. He is to be the torchbearer of the Ijaws, one chosen by divine grace to cancel the injustice done to his people. These are hardly lofty reasons.

There is no sign that Mr. Jonathan, himself, truly desires the job. He appears to be running to avoid the consequences of not running. But this country does not need another reluctant president, one pressured into office by primordial forces. What other pressures will he succumb to when he gets there?

Some say he wants the job but it is not in his nature to rush; he prefers to tread softly, feeling his way through the maze.

We are supposed to believe that the fact that four months to elections a sitting president is too timid to declare his candidacy, is a strategy. As one of his aides told Reuters, “The president will not declare until he is sure that he will win.” He is reportedly frustrated by PDP governors who have refused to give him that kind of assurance. Governors Rotimi Amaechi, Bukola Saraki, Babangida Aliyu, Mr. Sylva, Emmanuel Uduaghan, Gbenga Daniel, and Danjuma Goje continue to hedge their bets and to allegedly chip away at the support of their colleagues. “They will come to me to pledge their loyalty and endorsements whereas intelligence reports from their states indicate they have other agenda,” Mr. Jonathan was quoted as saying at a recent meeting.

This is not good; it does not show a mastery of the use of power. Mr. President must also see how his vacillation allowed people like Ibrahim Babangida and Atiku Abubakar, consummate players, to exploit his weak grasp of the reigns, challenging him on the platform of his own party.

“The deal I have with IBB” said Mr. Abukakar, “is that when this has been resolved, we will enter into a room and then, one person would emerge.” Still, the president waits, craving the support of powerful men, sending emissaries to ‘key traditional rulers’, governors, party chieftains, senators, and other ‘important people’. One day, perhaps sometimes before the elections,he may yet deign to meet with the rest of us, Nigerian people who, presumably,are the ones to vote him into office.

No, Mr. Jonathan is not the one we have been waiting for. Hamlet should please take his bow, “Ambition should be made of sterner stuff.”

^^^^
celebration of mediocrity.

same beat with almost same lyrics.

one hit wonder.

lengthy but worth reading:-

The M&A between Dangote Cement and BCC - Matters Arising


Is it okay to promote/pitch the Dangote/BCC merger and listing as a good panacea to the leverage banks has on the NSE? Yes, it would appear so – without sentiments.

That is – unless such sentiments are devoid of questions about the process, communication management, and the perception related thereto or arising therefrom. Let us take a look at some five issues ahead of the analysis that is to come from the scheme of merger:

First, in managing the news communication, information had filtered out weeks back about the alleged granting of waivers on fees, given the amount involved. This had led to more interest from the market, long aware of discussions on the planned merger before the breakdown in corporate governance ethos at the NSE. The eventual newspaper expose therefore, of factual internal decisions from the SEC, and ahead of the NSE’s decision was considered a fait accompli. This in itself suggested that this was a deal that needed to go through, presented as an indication of market confidence return and without any investment justification or discussion on the investment rationale or benefit to the average investor.

Since no formal business combination document was publicly released before the NSE approval, it would be safe to assume that the newspaper reports were no more than corporate press releases, rather than market news.


Second, We recall that one of the problems with this deal with the then NSE management was the contentious issue of compliance with the market rule that no one person holds more than 75% of a publicly listed company (i.e. NASCON) and the information that only 3% was offered to shareholders of BCC Plc. This matter requires a public clarification, including a confirmation of consent from the shareholders of BCC Plc.

It is instructive that we clarify that the percentage which BCC Plc shareholders will own is dependent on how many shares the new company is issuing. BCC Plc shareholders that do not want to be part of the merger should/could be bought out – as is standard practice.


Third, it would appear that the decision to approve the merger was not contained in the Agenda and final resolutions at the last AGM of BCC Plc – the listed company on the bourse. We are to assume that this must have been obtained at an extra-ordinary general meeting held before the documents were presented to Sec and the NSE, as part of what the regulators would have had to review.

It would appear that we do not have the type of situation experienced with Unipetrol Plc and Agip Plc, both quoted firms – but more of the situation in Zenon Oil’s attempted takeover of AP Plc with us. In this latter incident, the shareholders of AP Plc were consulted at an extra-ordinary general meeting held at Ibadan and their resolution forwarded to the SEC who rejected the deal and remains the reason why the AP/Zenon merger never took place.

Yet as we can see from the petitions making the rounds from insiders, both companies are being run as one. This might prove an instructive parallel in the days ahead as the shareholders role in assenting to such a deal gains traction. How did the SEC/NSE approve the deal without the shareholders consent given its public interest mandate?

The scheme of merger (court ordered document) has now been released and sent out to shareholders.

Further to the SEC/NSE approval, and preparatory to the listing of the new company, shareholders of BCC and Dangote Cement will now hold separate court-ordered meetings on September 28, 2010 in Kano to endorse the scheme of the arrangement. While the meeting of shareholders of BCC will hold at 11.00 am, that of Dangote Cement would hold at 10.00 am. Specifically, 15.494 billion units of the expanded company would be listed at N135 per share – a record high for a listing by introduction in the annals of the exchange http://proshareng.com/news/11978


Fourth, it is important to the market that a clarification is provided on the status of the new company and if the other Dangote cement operations in other countries will form part of the new Dangote Cement Plc. It is instructive to note that the Dangote Cement operations extends to existing entities in Zambia, Senegal, Benin, Ghana and South Africa which are reported to be viable operations, albeit with lower annual production outputs.


Fifth, Perhaps more important to the practice of M&A in our capital markets is the need to bed the conflict of interest possibility that appears to exist in the transaction – based on communications so far.

It would appear that the financial advisor representing the unlisted Dangote Cement Limited on the one hand and the listed BCC Plc on the other hand is the same entity – Afrinvest Limited.

It is curious that the advisers on the buying side equally appear on the selling side of the transaction – with all the implications on transparency, pricing, and the ‘who is working for whom’ question. Was a special approval sought and granted by the SEC?


Sixth, the market could not ignore the timing impact of this decision, four weeks after the SEC acted on a petition by the promoter of the companies merging, to take over the NSE – having his merger plans now approved with dispatch. It is a curious co-incidence but since we do not live in a world devoid of co-incidences, we have to assume that nothing untoward is/was at play.

The notion that the merger, as explained below, could effectively make the promoter potentially responsible for more than a third of the market capitalisation however raises questions that impacts on the demutualisation agenda – a subject for another day.

The total market cap of the banking sector as 6th September is N2.371 trillion out of a total market cap of approx. N5.901 trillion (minus the 2nd tier which contributes N4.155bn) – if the total Dangote company market capitalisation before the merger is considered i.e. Dangote Flour N85.150bn, Dangote Sugar N196.680bn, BCC N246.913bn, NASCON – N16.161bn; we have a total of N0.595 trillion - already 10% of the total market share. BCC’s and Dangote Cement had revenues last year of around N33.35bn ($230m) and N188.50bn ($1.3bn) respectively.

With the expanded company - to be known as Dangote Cement Company Plc, this should add about N2.13 trillion to the market capitalisation of the NSE and effectively bring the Dangote Group to an effective 43% of the total market capitalisation as at September 6, 2010. That is an interesting scenario to contemplate.

We reiterate that we have nothing against the initiative and we recall that UACN Plc – the conglomerate is equally listed on the bourse with a separate and distinct board; having related companies such as Grand Cereals and UACN properties listed on the exchange. This has never been promoted or reported as a ‘block’.

There must be some reasoning in the two approaches and the market may need to take time to discern the emerging trends.


Seventh, the last listing by introduction we had, of this magnitude was the November 2006 approval given by the Council of The Nigerian Stock Exchange through its Quotation Committee to the Transnational Corporation of Nigeria Plc's listing by Introduction of 18.55 billion ordinary shares of 50kobo each at N6.00 per share. The shares which was listed on Thursday, November 23, 2006 with a market value of N111 billion is now priced at N0.50k.

Most companies listed by introduction on the NSE in the last 3 years were generally weak companies and are currently facing dire straits – MTS Plc, IHS Plc, MTech Plc, etc are currently trading below listed prices; and a few are facing current NSE sanctions for failure to meet post listing financial reporting requirements less than twenty four (24) months after listing.

There are only a few sterling example of listing via introduction – GT Bank Plc for example which listed at N10 per share in 1996 and later conducted an IPO at the onset of the banking consolidation programme; which established the bank as a value based company – and we are all living testimony as to the strength and character of this commercial lender, now one of the top three banks in Nigeria.

The parallel with Transcorp Plc should not and must not encourage a comparison with this current bid by the new Dangote Cement Plc but should raise concerns at the SEC/NSE, which has not had a history of high value listing by introductions – a traditional approach usually deployed for weaker companies seeking listing outside the primary market.

The point being made here relates to the point made earlier; the high price of listings by introduction relative to the current market realities and the rules for listing by introduction that should have safeguards to protect investors in the secondary market.

The true test of a company of Dangote’s mettle must be the primary market – the offering of the shares of the merged company, after a listing in no less than 6-12 months should address this concern.

This is not a notion unique to Nigeria or a recommendation specific to the company. There is a growing debate about the place of listings by introduction and investors protection that we must consider given our recent past.

For example, the Philippine Stock Exchange (PSE) has suspended listings by introduction, other than those applications filed before February 17, 2010 and is reviewing its rules. Companies can list their shares on the PSE by introduction as long as they agree to hold an IPO within 12 months.

The PSE said that "we are reviewing the rule on listing by way of introduction…. to make sure that the rules are consistent and clear so that issuers can be guided correctly and at the same time ensure that the investing public is fully informed of the developments with the issuers," PSE Chairman Hans Sicat said in a statement on February 2010.

The PSE bourse temporarily blocked companies from listing by introduction last February 18. While it gave no explanation for the suspension, the move came as share prices of companies that had taken this route — listing stocks without necessarily selling these to the public — skyrocketed.

The action followed a similar move by the Hong Kong Exchange to halt listing by introduction unless issuers can show they have taken steps to ensure ample liquidity and an orderly market, and until the bourse finds ways of dealing with potential price fluctuations.

At the HHE, the new practice follows an opening day surge and plunge in shares of Asian Citrus Holdings Ltd., China’s biggest orange plantation owner, that prompted investors to criticize disclosure rules.

Generally, several companies that listed their stocks by introduction in most markets; have seen dramatic increases in their share prices, raising concerns that a loophole was being used to drive up prices.

It is this point that we have yet to receive assurance on from our market regulators in Nigeria.

lengthy but worth reading:-

[b]The M&A between Dangote Cement and BCC - Matters Arising


Is it okay to promote/pitch the Dangote/BCC merger and listing as a good panacea to the leverage banks has on the NSE? Yes, it would appear so – without sentiments.

That is – unless such sentiments are devoid of questions about the process, communication management, and the perception related thereto or arising therefrom. Let us take a look at some five issues ahead of the analysis that is to come from the scheme of merger:

First, in managing the news communication, information had filtered out weeks back about the alleged granting of waivers on fees, given the amount involved. This had led to more interest from the market, long aware of discussions on the planned merger before the breakdown in corporate governance ethos at the NSE. The eventual newspaper expose therefore, of factual internal decisions from the SEC, and ahead of the NSE’s decision was considered a fait accompli. This in itself suggested that this was a deal that needed to go through, presented as an indication of market confidence return and without any investment justification or discussion on the investment rationale or benefit to the average investor.

Since no formal business combination document was publicly released before the NSE approval, it would be safe to assume that the newspaper reports were no more than corporate press releases, rather than market news.


Second, We recall that one of the problems with this deal with the then NSE management was the contentious issue of compliance with the market rule that no one person holds more than 75% of a publicly listed company (i.e. NASCON) and the information that only 3% was offered to shareholders of BCC Plc. This matter requires a public clarification, including a confirmation of consent from the shareholders of BCC Plc.

It is instructive that we clarify that the percentage which BCC Plc shareholders will own is dependent on how many shares the new company is issuing. BCC Plc shareholders that do not want to be part of the merger should/could be bought out – as is standard practice.


Third, it would appear that the decision to approve the merger was not contained in the Agenda and final resolutions at the last AGM of BCC Plc – the listed company on the bourse. We are to assume that this must have been obtained at an extra-ordinary general meeting held before the documents were presented to Sec and the NSE, as part of what the regulators would have had to review.

It would appear that we do not have the type of situation experienced with Unipetrol Plc and Agip Plc, both quoted firms – but more of the situation in Zenon Oil’s attempted takeover of AP Plc with us. In this latter incident, the shareholders of AP Plc were consulted at an extra-ordinary general meeting held at Ibadan and their resolution forwarded to the SEC who rejected the deal and remains the reason why the AP/Zenon merger never took place.

Yet as we can see from the petitions making the rounds from insiders, both companies are being run as one. This might prove an instructive parallel in the days ahead as the shareholders role in assenting to such a deal gains traction. How did the SEC/NSE approve the deal without the shareholders consent given its public interest mandate?

The scheme of merger (court ordered document) has now been released and sent out to shareholders.

Further to the SEC/NSE approval, and preparatory to the listing of the new company, shareholders of BCC and Dangote Cement will now hold separate court-ordered meetings on September 28, 2010 in Kano to endorse the scheme of the arrangement. While the meeting of shareholders of BCC will hold at 11.00 am, that of Dangote Cement would hold at 10.00 am. Specifically, 15.494 billion units of the expanded company would be listed at N135 per share – a record high for a listing by introduction in the annals of the exchange http://proshareng.com/news/11978


Fourth, it is important to the market that a clarification is provided on the status of the new company and if the other Dangote cement operations in other countries will form part of the new Dangote Cement Plc. It is instructive to note that the Dangote Cement operations extends to existing entities in Zambia, Senegal, Benin, Ghana and South Africa which are reported to be viable operations, albeit with lower annual production outputs.


Fifth, Perhaps more important to the practice of M&A in our capital markets is the need to bed the conflict of interest possibility that appears to exist in the transaction – based on communications so far.

It would appear that the financial advisor representing the unlisted Dangote Cement Limited on the one hand and the listed BCC Plc on the other hand is the same entity – Afrinvest Limited.

It is curious that the advisers on the buying side equally appear on the selling side of the transaction – with all the implications on transparency, pricing, and the ‘who is working for whom’ question. Was a special approval sought and granted by the SEC?


Sixth, the market could not ignore the timing impact of this decision, four weeks after the SEC acted on a petition by the promoter of the companies merging, to take over the NSE – having his merger plans now approved with dispatch. It is a curious co-incidence but since we do not live in a world devoid of co-incidences, we have to assume that nothing untoward is/was at play.

The notion that the merger, as explained below, could effectively make the promoter potentially responsible for more than a third of the market capitalisation however raises questions that impacts on the demutualisation agenda – a subject for another day.

The total market cap of the banking sector as 6th September is N2.371 trillion out of a total market cap of approx. N5.901 trillion (minus the 2nd tier which contributes N4.155bn) – if the total Dangote company market capitalisation before the merger is considered i.e. Dangote Flour N85.150bn, Dangote Sugar N196.680bn, BCC N246.913bn, NASCON – N16.161bn; we have a total of N0.595 trillion - already 10% of the total market share. BCC’s and Dangote Cement had revenues last year of around N33.35bn ($230m) and N188.50bn ($1.3bn) respectively.

With the expanded company - to be known as Dangote Cement Company Plc, this should add about N2.13 trillion to the market capitalisation of the NSE and effectively bring the Dangote Group to an effective 43% of the total market capitalisation as at September 6, 2010. That is an interesting scenario to contemplate.

We reiterate that we have nothing against the initiative and we recall that UACN Plc – the conglomerate is equally listed on the bourse with a separate and distinct board; having related companies such as Grand Cereals and UACN properties listed on the exchange. This has never been promoted or reported as a ‘block’.

There must be some reasoning in the two approaches and the market may need to take time to discern the emerging trends.


Seventh, the last listing by introduction we had, of this magnitude was the November 2006 approval given by the Council of The Nigerian Stock Exchange through its Quotation Committee to the Transnational Corporation of Nigeria Plc's listing by Introduction of 18.55 billion ordinary shares of 50kobo each at N6.00 per share. The shares which was listed on Thursday, November 23, 2006 with a market value of N111 billion is now priced at N0.50k.

Most companies listed by introduction on the NSE in the last 3 years were generally weak companies and are currently facing dire straits – MTS Plc, IHS Plc, MTech Plc, etc are currently trading below listed prices; and a few are facing current NSE sanctions for failure to meet post listing financial reporting requirements less than twenty four (24) months after listing.

There are only a few sterling example of listing via introduction – GT Bank Plc for example which listed at N10 per share in 1996 and later conducted an IPO at the onset of the banking consolidation programme; which established the bank as a value based company – and we are all living testimony as to the strength and character of this commercial lender, now one of the top three banks in Nigeria.

The parallel with Transcorp Plc should not and must not encourage a comparison with this current bid by the new Dangote Cement Plc but should raise concerns at the SEC/NSE, which has not had a history of high value listing by introductions – a traditional approach usually deployed for weaker companies seeking listing outside the primary market.

The point being made here relates to the point made earlier; the high price of listings by introduction relative to the current market realities and the rules for listing by introduction that should have safeguards to protect investors in the secondary market.

The true test of a company of Dangote’s mettle must be the primary market – the offering of the shares of the merged company, after a listing in no less than 6-12 months should address this concern.

This is not a notion unique to Nigeria or a recommendation specific to the company. There is a growing debate about the place of listings by introduction and investors protection that we must consider given our recent past.

For example, the Philippine Stock Exchange (PSE) has suspended listings by introduction, other than those applications filed before February 17, 2010 and is reviewing its rules. Companies can list their shares on the PSE by introduction as long as they agree to hold an IPO within 12 months.

The PSE said that "we are reviewing the rule on listing by way of introduction…. to make sure that the rules are consistent and clear so that issuers can be guided correctly and at the same time ensure that the investing public is fully informed of the developments with the issuers," PSE Chairman Hans Sicat said in a statement on February 2010.

The PSE bourse temporarily blocked companies from listing by introduction last February 18. While it gave no explanation for the suspension, the move came as share prices of companies that had taken this route — listing stocks without necessarily selling these to the public — skyrocketed.

The action followed a similar move by the Hong Kong Exchange to halt listing by introduction unless issuers can show they have taken steps to ensure ample liquidity and an orderly market, and until the bourse finds ways of dealing with potential price fluctuations.

At the HHE, the new practice follows an opening day surge and plunge in shares of Asian Citrus Holdings Ltd., China’s biggest orange plantation owner, that prompted investors to criticize disclosure rules.

Generally, several companies that listed their stocks by introduction in most markets; have seen dramatic increases in their share prices, raising concerns that a loophole was being used to drive up prices.

It is this point that we have yet to receive assurance on from our market regulators in Nigeria[/b].

bigben431:
It is really hard to explain core finance terms to people who are not in the field (no offense) , there are just too many factors that come into play that an outsider really doesn’t crap. One big thing I forgot is the future cash flow for the company, there is always going to be demand for cement in Africa. The continent needs about $1 trillion of infrastructure spending over the next 20 years.

And no alternate research analysts are needed to come up with an alternate valuation. Playing in the stock market is not for everyone…u should use your head to invest and not your heart.

No sir.
I do not need a degree in Finance to understand that Lafage has operations in Africa in addition to the rest of the world.
Therefore, the bold comments do not hold water.

best of luck to those hoping to buy these or other shares.
I would not buy any such thing in this country again until I see a semblance of transparency and professionalism in the capital and equity market.
It takes a higher power differentiating the frauds of the genuine.

ha ha ha ha !!!
Interesting and insightful thread.