₦airaland Forum

yMcy56:
OK!
So no one has posted about the status of OANDO in market so far.....
Ok o, attached is the screenshot.....and the bid has increased past this as at now.....
Thank you Jesus!

It's okay for people to not see what you see in a stock. I don't believe it's anything personal. If I'm not mistaken, you don't seem to appreciate negative comments about a stock whose SP is falling. Look at trading today despite the discussions within the last 24hrs or so. This is purely TA at play. Buyer exhaustion, profit taking, capital preservation and sellers bailing. Now, they are exhausted and SP is stabilising and will find a new support before the next lot of news.

By the way, my TA knowledge is elementary.

chimex38:
Ok. Thank you for the detail.🙏

Sorry for the confusion:
By floor members, I mean ordinary or minor shareholders of a company.

If I get you right, both minor shareholders who qualify for right issue can also apply to take up more than their qualifying number of rights as long as those rights were not taken up....
....and this option is not restricted Only to Major shareholders, Chairmen influential members, etc ?

In normal circumstances, all existing shareholders including majority and minority shareholders are allocated additional shares over and above their Rights based on a ratio.

So No, it's not restricted to only influential shareholders. If I haven't done justice to your query enough, have a read of below snip from Fidelity's RI.

What was all that hullabaloo over Oando about?
A stock delivered almost 400% in about 5wks and retracement led some to lose their cool?

Can someone point to a stock on the NSE that has delivered the way Oando has in 5wks? Take a look at the TA na. Daily max gain for more than a week. Profit taking should be expected along the way. It's just the way the market works. The market will now determine a fair value based on news released so far until next news/announcement is released. If it's positive, expect the market to reward the SP. If negative, expect the opposite. C'est normal.

Can I just ask that we show some respect to other forum members? Social/forum etiquette is important. Please let's show some maturity in our posting. Allow others share their views and once you have made your point, there is no need to troll the forum.

In my opinion, Oando will .........

Let me stop there. I need to be sober.

Disclaimer - I didn't suggest any trading or investment strategy, if it appears I did you probably misunderstood my point.

chimex38:
@bolded..is it possible for floor members also?
Or restricted to Chairmen n ko?

Floor members need to first acquire the right to participate in the offer by purchasing "rights" on the floor of the exchange. Afterwhich they pay the applicable cost of the shares being issued as Rights.

The above scenario is different from what you bolded.

In this case, the "chairman" and existing holders are participants in the Rights issue by "right". So all they'll need to do is to apply for more than their share and Rights not taken up (by other existing shareholders and not sold on the floor) will be distributed amongst interested shareholders. If there is an oversubscription, it is usual to have allocations scaled back for the extras over your Rights.

Mpeace:
Fidelity did it cos they combined rights issue with Public offer.

All those banks doing only rights issue will hardly make it.

With public offer, the chairman go just buy up all the things wey shareholders no want buy

Pretty sure the chairman or any existing shareholder can also buy up all the shares not taken up in a RI. You can subscribe for more shares than you're qualified for in a RI.

I agree a public offer and Rights combination is the way to go though. A PO opens up the target market to "whosoever will" so not restrictive.

Willie2015:
CardinalStone started buying this week....
I had to increase my tasere units...

They are still buying apparently. They increased their position by #4,337,300 last week.

megawealth01:
I can't answer that as Mr Time has that answer but it won't be long

My brother if you have spare funds just leave in UNITY at #1+ you won't regret it if you play your games well... This government means it this time on UNITY as they won't want to offend the north

DD always

Was this why CBN didn't bail out Heritage bank?

SonofElElyonRet:
What would then be the probable listing price on NSE ?
What if the emerging entity chooses to buy off unity bank shareholders and be a private company as providus currently is?

I wish I had an answer for you. However, a successfully recapitalised bank should fetch a premium to the value of the old bank. Reason for that is that negative equity is wiped, debt paid off and balance is used as Tier-2 capital. Please don't get me wrong. I'm not suggesting Unity bank shareholders will be worse off post-merger, of course not. My point is that Providus, a relatively new private bank on the scene is getting the better deal. Providus shareholders are the ultimate winners based on the merger ratio reported. CBN has given us an indication of how it values Unity bank in comparison to Providus. Why didn't they just bail out Unity separately?

Also note that, the enlarged entity will tap the market/existing shareholders/institutions for extra funds to meet the recapitalisation requirement. There may well be a SP pump post merger......wait is it going to be listed?

I hope I'm well understood. I wouldn't celebrate the merger but wait to see how it pans out except you already knew CBN had flagged the financial state of the bank and you're now relieved the worst is behind you. Then happy days ahead. I don't believe Unity bank shareholders will lose money. I question the merger ratio.

If I have managed to dribble my way out of answering your question directly, no vex o.

Heishere:
Providus is a growth stock. One of the innovative bank that transformed from a mortgage bank in 2016 with a regional license. They are listed on NASD and I have been trying to buy their shares a while back cos I see them going far because of their innovation and strategy. They can be said to be digital bank in Nigeria. They were the pioneers of fintech integration to banks in Nigeria. While many people were opening fintech accounts, they were actually banking with Providus because their funds were digitally housed and settled in the bank. Great number of fintech partners including major ones like Monnify, Jumia, Fairmoney, Bet9ja (CFO is related to Bet9ja owner) etc were integrated to the bank. The integration boosted them with good liquidity at clearing house and they broke even in 2019. Since then they have been in profit unlike some of their mates. They made around N8Billion in 2022. But their cost to income ratio is high due to expansion drive. Going by their books they couldn't have been able to purchase Unity.

I guess the merger was strategic for them because instead of paying to upgrade their license to national they killed two birds with one stone with the help of CBN.CBN also pumped in bailout funds of over N600Billion to clear Unity bank obligations. If owning a share of Unity bank means automatically becoming a shareholder of Providus, I will grab it immediately. Imagine a bank that broke even just 3 years after they started and by 2022 was making profit that is about 42% of what Sterlingbank that have been in the business for long made in the same year. That is aggressive growth and I want to be part of it. Their niche used be the affluent and HNIs while they serve retail through fintech. I guess they have changes now since they are going national.

Providus bank was delisted on 21-03-2022 according to the NASD website.
Reason for delisting - converted to a private Limited Liability Company.

megawealth01:
What's the current value of PROVIDUS?

Please be reminded that my post may be factually incorrect and misleading. No malicious intent please just sharing my opinion.

2022 FYE Report as reference:
Providus has a share capital of N18B translating to #36,036,786,000 ordinary shares of 50kobo each. Latest available financial result is the 2022FYE where the bank achieved EPS of 22k (23k in 2021FYE).
You can use a discounted PE to work out the MCAP - PE x EPS (I'll use the same EPS from 2022 as there's no guarantee the bank achieved any growth in 2023FYE). 2021 FYE EPS was 23k.


You're looking at #11,689,338,000 shares of Unity bank being converted to #9,009,196,500 units of the enlarged entity representing 20% of the entity. Providus bank shareholders will hold the remaining 80%. Providus is considered the dominant partner.

Let's use the last audited EPS of Wema bank to derive a suitable PE ratio.
2023 EPS = N2.80
Price = N6.15
PE = 2.19

Apply PE to derive Providus(old bank) SP.
2.19 x N0.22 = N0.48k
MCAP = N17,297,657,280.00
Caveat : The market sometimes ascribes an unjustifiably high PE to a stock. So valuation could be considerably higher.

The enlarged or combined entity should have a higher PE and if owners decide to list on the NGX, the new shares will be LISTED BY INTRODUCTION on the NGX.

Disclaimer- My post could be misleading so please don't make any financial decision based on my post. Please consult your financial adviser.

Mankind2024:
This merger arrangement appears to be coercive. The history of Providus Bank is deeply rooted in ARM, and PBAT has an indirect and undisclosed interest in ARM. This situation bears a striking resemblance to the past takeovers, such as Access Bank's 100% acquisition of Intercontinental Bank and the defunct Diamond Bank, where control was exerted through subtle means.

I tried to do a quick search and a Mortgage bank came up so I decided not to include that in post. I don't need further evidence. Summary is that nothing calls for celebration in that news. I hope for the best outcome for those in Unity sha. I come in peace.

On the Dangote crude supply saga, it's not as easy as some of you make it to be.

Dangote wants direct crude supply for his refinery without any middlemen.
Dangote does not want any markup on the selling price.
Both valid points.

FGN in a precarious situation.
They have borrowed against future crude production which is also below where it should be ideally.

If FGN decides to fully meet Dangote's demand, on his terms and as per the law to the detriment of the creditors, it will backfire. To the poster suggesting it's the creditor's business he entered into an illegal contract, okay, all good. Creditor calls for their money, how will the FBN pay back? You miss a very important and critical point about sovereign debt. Once you show an inability to meet your contractual obligations to international creditors, it affects your ability to secure future loans at competitive rates if at all. Crude is Naija's major lifeline.

Ideal solution would be to ramp up production to satisfy contracts and also meet the refinery's demands but we know that is another problem on its own. At this stage, a compromise of some sort will be needed.

The part I'm not sure of is the "middlemen". I need to dig into that a bit more. These middlemen have always been there from the beginning. They were licenced to lift crude from upstream producers and supply them to bidders all over. Obviously, the solution they found was to "round trip the crude". Instead of selling all cargoes or deliveries to their customers, they intend to markup the price at $4 per barrel, sell to Dangote and their customers keep the $4pb which Dangote is rightly against.

Anyway, my point is the solution is not as simple as one may think.

Disclaimer - It's most likely I don't even understand what the issue is so don't take my word for it and don't let it upset you. Just my two cents.

megawealth01:
Still on UNITY BANK and PROVIDUS...

If I'm not mistaken, your rationale for investing in Unity bank was because of your belief that the bank is on its way to profitability. Judging by the profit forecast released by the bank, we can safely assume this will eventuate.

However, I think you may be misinterpreting the Providus bank vs Unity bank "merger". Technically, the CBN has just bailed Unity bank or saved Unity from going under by selling it to Providus bank with some extra cash bonus to keep the enlarged entity going. Providus is the winner here not Unity. Enlarged entity is 80% Providus and 20% Unity. What is Providus history as a bank sef? Unity bank shareholders will be issued new shares equivalent to a quarter (or 25%) of the current value of Providus bank. I hope for your sake that CBN and Providus intend to have the enlarged entity listed. Otherwise, I'm not sure there is much to get excited about here. I'm just a bit confused about the excitement here. Maybe I'm missing something.

megawealth01:
Abeg help me market am well maybe it will conquer MRS in price

I fell for the temptation to post about Oando today. If there was ever a cue to stop that was it. I no be Oando marketer o.

SonofElElyonRet:
Seems Oando at N50 is just a stroll away !

Unfortunately, I couldn't tell ya. I wish I knew myself. Sentiments seems strong though. I'm not sure but it seems there has been a few "tree shakes" to push out weak holders of Oando.

What MAY eventually happen is that the market may reprice Oando using a discounted PE value of Seplat IF and only IF 2024 quaterly results confirm the turnaround story. Your assignment is to find out the implication IF this were to play out. Market CAP is c. N350B based on current price.

Speaking of the NAOC deal, for anyone who is interested. Please take note of first three dot points. The information the market knows is out there, it is for you to try make sense of it.

Disclaimer - I have no clue whatsoever what the future holds for Oando. Just sharing my thoughts. Please do not buy or sell based on my posts.

SonofElElyonRet:
Nigeria Targets Fresh 50,000bpd Oil Output With New Crude Grade, Utapate

SonofElElyonRet:
They know something about Oando.. even the Japaul attention might be because of the N20b jagwa spoke about... although the price is also attentively low

KarlTom:
There must be something driving this current rally...

Let me help you out

Read this news item - https://thesun.ng/nigeria-increases-oil-production-by-28000-bpd-with-new-utapate-crude/

Oando has a 40% Working Interest (WI) in OML 13 (QUA IBO). That is WHY

Most of us here don't even understand the upstream business let alone know how to value Oando, a company with negative equity. Let's just keep watching, okay?

BTW, this has nothing to do with the NAOC acquisition that effectively doubles production.

Forgot to include disclaimer so here goes: Not a recommendation to buy or sell Oando as I'm not qualified to give any form of financial advice. I have also been wrong many times before.

Laso09:
Good job.
But how will that affect the shareholding structure?

Free float issue will be exacerbated. In my opinion, they will either have to do a share sale to the public or delist. The former is not likely in my opinion because if that was the plan, they could just have done a public offer instead of a Rights issue.

That said, they claim to have a plan and would advise the market shortly. What could their plan be?

Disclaimer - Just mere speculations from me. Sentiment - None. Position - Not Held

Laso09:
Thanks, could it be that the owner have already deposited money for the RI

I'm inclined to think so at this stage too.

ositadima1:
It was approved by the SEC as stated in the corporate disclosure.

Now, regarding the equity conversion, this looks more like the RI (Rights Issue) took place(in advance ). I don't see why shareholders would lend 500 billion with nothing in exchange, especially when an RI is approved by the SEC.

SEC is yet to approve the results of the RI was what I meant. So No, the debt was not "officially" offset by the proceeds of the RI.

SEC granting approval to proceed with a capital raise is different from approval for issuance and listing of new shares. Note 17 clearly states the later is yet to be approved.

Laso09:
I don't even know myself.
I am just being curious to understand those figures.

It's all there in the report. I couldn't get the formatting right but I hope you can make sense of the images attached at the summary.

The source - Shareholder loan -equity conversion
Image #1

What it was used for - Debt repayment ($342M is c. N512B)
Image #2

The effect - Zero borrowings and jump in Equity
Image #3

Reasonable enough for me as SEC is yet to approve the RI (Notes 17, pg 12).

mikeapollo:
And where did you also read after the NUPRC statement that the legal title in NAOC assets has not been passed on to Oando?

The signing ceremony is just to formally announce the deal to the public (industry watchers) and take pictures for the records.
It is different from the legal status (substance) of the transaction, which is binding and the ultimate.
The signing ceremony takes place usually between the contracting parties (e.g. ENI/NAOC, Oando) and some stakeholders in the industry (e.g. regulator NUPRC, contractors, employee unions, press, analysts, banks etc.). Bodies like SEC, CAC, the Court, FCCPC may not be present at the signing ceremony, but they all would have had in their possession the executed (signed) agreement/deal with the binding legal status clearly spelt out.
So the signing ceremony is the not the deciding factor. It is only a form of announcement or communication to the industry.

In business contract transactions, what matters is the substance rather than the form.

Okay, all good.

mikeapollo:
I agree with most of your opinions, but you got one fatally wrong.
As regards the bolded, I don't understand what you mean by ''....the signing ceremony for the NAOC deal is still pending, so until then, completion of the deal cant be deemed official....''. This is false.

It is not the signing ceremony that validates or invalidates a contract transaction between two parties. A ceremony is not a factor to determine the completion of a deal. Not every organization is given to the idea of having a funfair or public shows when signing a business deal.
Once the basic ingredients of a contract: valid offer and acceptance, passage of consideration, legal, regulatory and other stakeholders (e.g. employee labour unions) approvals etc. have been achieved, the deal is done and sealed. The offer, acceptance and consideration have already been acknowledged and signed by the parties to the contract at the highest level and delivered to regulatory bodies e.g. NUPRC, SEC, FCCPC etc. They do not have to perform a ceremony in public or for the press.

How can lack of a public ceremony undo or invalidate a deal that NUPRC (which regulates both NAOC and Oando in the Nigeria upstream sector) has approved and announced as complete? The NUPRC, SEC, etc. are already in possession of legal documents that have been signed and sealed by official representatives of both parties. It is not the publicity or press ceremony that would validate the contract.

Where did you read that Oando has a legal title to NAOC's assets in the JV? It will be handed over to Oando during the signing ceremony. I'm not suggesting it's not a done deal.

Signing ceremony is not for rice and poundo o. It's just a formality transactions of this nature undergo. NUPRC CEO simply said deal is completed, regulatory approvals granted, but docs still be be signed. They like to make a fanfare of deals of this nature. Just picture CEOs and government officials sitting across tables and passing some documents around and taking a few photos with Wale holding up a certificate. Think of it this way, you have graduated from Uni but you will have to wait for the convocation day to collect your Cert or degree.

"Acquisition status
According to him, the NAOC – Oando deal is completed and the signing ceremony is to be conducted in the coming days. "

https://nairametrics.com/2024/07/03/nuprc-announces-the-completion-of-oando-nigeria-agip-oil-company-acquisition-deal/

SonofElElyonRet:
Merely an attempt to justify continued shameless importation of petroleum products and corrupt enrichment of the cabal through the subsidy regime which though was said to have been removed, still subsists

Are you sure? I'd wait for a rebuttal from Dangote first before I draw any conclusions. If you're an ordinary citizen and consumer of the product, I reckon it's better to stay objective. Mr Ahmed quoted some figures which I hope are verifiable. There may well be sense in what he is suggesting. It's important they supply quality products to Nigerians.
From Dangote's business perspective, blocking off fuel importation is ideal and I somewhat agree/support if he is ready to supply quality products. Monopoly is good for his business and I wish him well but not at the expense of Nigerians.

mikeapollo:
The court had stated that the adjournment was to allow the company to produce a report of compliance with the Court’s order dated June 7, 2022, which requires it to submit its Scheme of Arrangement document to the Securities and Exchange Commission (SEC) and the NGX within 30 days, along with other instructions.
https://nairametrics.com/2024/07/18/court-says-oando-minority-shareholders-cannot-be-forced-to-sell-their-shares/

This means that the Court was always adjourning because Oando still delayed and failed to produce a report of compliance with the order to submit its Scheme of Arrangement document to SEC and NGX for the delisting of the shares!

It seems the case was delayed and frustrated by Oando itself!

Bro, in my opinion that is factually incorrect. My understanding of the situation is different.
Disclaimer: In the future, if it turns out I was wrong, I apologise now o

The process in no particular order is as follows:

* Development of scheme document - Achieved
* Submission of scheme document to SEC - Achieved
* Approval of scheme document by SEC or receipt of SEC "No objection" - Not approved yet
* Court sanction of scheme document - Not achieved yet
* Court ordered shareholder meeting - Not achieved yet
* Approval of scheme document by shareholders - Not achieved yet
* Commencement and completion of offer to shareholders - Not achieved yet
* Court sanction of transaction as per terms of scheme documents - Not achieved yet
* Delisting from NGX - Not achieved yet.

And NO, it doesn't depend on Wale either. Particularly, for him, it is a bit complicated. He has had a bitter clash with SEC in the past which was settled out of court eventually. Based on his antecedents, I don't believe SEC will approve the Scheme document as it stands especially not at such ridiculous terms. Literally, they were hell-bent on booting him out of office. SEC is the bottleneck in the whole process.

Refer to link below for the process and why he has not been able to produce the document the court requested. He doesn't have it yet. It is as simple as that. He is not the one stalling.

https://www.oandoplc.com/press_release/oando-plc-announces-proposed-scheme-of-arrangement/

"Consequently, we confirm that Oando has applied for the SEC’s ‘No Objection’ to the Scheme. Please note that the effectiveness of the Scheme is subject to the approval of the shareholders of Oando at the Court-Ordered Meeting of the Company, as well as the sanction of the Federal High Court. The terms and conditions of the Transaction will be provided in the Scheme Document which will be dispatched to all shareholders following the receipt of an order from the Federal High Court to convene a Court-Ordered Meeting. If the conditions of the Transaction are satisfied and same is sanctioned by the Federal High Court, the Company will be delisted from NGX and JSE and re-registered as a private company."

I hope the parties go back to the court and be like sorry oga judge, it's now a family matter. We will settle out of court.

My position on recent trading in the shares of Oando: I believe it's still a case of buying the rumour. News submitted to the NGX is the factual news not what is reported in the newspapers or online media. I'm not saying they are inaccurate but the market will attach more substance to news released on it's platform. Unfortunately, the signing ceremony for the NAOC deal is still pending so until then, completion of the deal can't be deemed official. I believe this is the reason Oando is yet to report this development. Same reason the JSE is yet to respond (no official news yet). This could be a major price catalyst once officially released.

ALL in my opinion

KarlTom:
Oh

Yeah, just in case you didn't know, your acct number is included in the "remark".

Let's not make it easy for them

KarlTom:
I got the credit notification...

Today happens to be the AGM.

Too much information? Maybe not. Are you comfortable posting your bank details to an online forum?

Well, I see "Influencers" asking people to drop their account numbers on social media for giveaways so maybe it's no biggie these days.

From where I stand, the completion of the Agip deal is a game changer for the company. I expect Oando to release an announcement to breakdown what this acquisition means to the company and its shareholders. That's what a good CEO would do. Sell the news while it's hot. Many may still not understand the ramifications though until they see the Q3 and Q4 results which should incorporate Agip's assets.

Oando's best asset has just been doubled while they shed the less quality assets. We can argue poor leadership is also a bane of this company. It's an empty post, lets see if Wale can manage to put the ball in the net. Recent news suggests a genuine turnaround might be in the offing.

The FG has signified interest in cranking up crude production which should augur well for E&P companies. If they can manage security and infrastructure availability properly such that it translates to increased production, there could be some good money to be made by all players. As for Oando, their financial report should look better if they can push for 100,000BOE in production this year.

My post could be misleading so please do your own DD.

bovali:
The difference between me and you is that I have no emotional attachment to any stock. Show your workings. My history is here in this thread. You cannot put words into my mouth. I am extremely objective. Let Oando close above 16 Naira first. Till then, it will continue moving sideways. See my trades from last quarter. I exited at 15 and entered other stocks that are now rallying as you can see from the portfolio I posted, while oando has not moved once

To be fair, since your background is finance, it's easy to understand why you would scrutinize financial report and base your investment decisions on the financial health of companies. I suppose you can't be bothered about operations but would wait to see how they translate to figures in the financials.

I guess one would not expect Oando to fit your investment philosophy so I also found it interesting that you traded it previously and still waiting for it at a bargain? Nothing wrong with that. Smart move if you can pick buy low and sell high. It's all about the money.

I hope you don't see my post as confrontational though. All I'm here for is friendly discussion on stocks...haha.

Mankind2024:
You don't have a personal investment philosophy, but I share information that can enlighten and empower investors. Your fear or caution is unfounded and holds no weight. Your view point is negative and anti-prosperity.
It has zero impact on my investment goals and objectives. Wake up ,diversify your portfolio and board the train of prosperity.
I'm the CEO of my portfolio and solely responsible for my investment decisions. I need zero validation from your gaslighting ⛽️ negative views.
The evidence is there for you to see. I will provide feedback in September or October and give you a final advise to eat your words

***Bookmarked this page***
The Magnificent 7 stocks don't belong to me, I've been following them since 2020. I can share more insights, educate, and encourage you to do your own research. As a modest self-investor, I'm not intimidated. The tech boom is still in its early stages, and the Magnificent 7 have yet to reach their full potential. While others may have doubted their success, my portfolio has gained $2K at the close of trading yesterday, thanks to these stocks. I'll refrain from sharing further updates on the Magnificent 7 to avoid derailing this thread.

I'm a bit confused here. Is there anything wrong with respectfully advising you and everyone else to exercise caution? I can't fault his post. It was just a friendly advise? You have gone full ballistic on a friendly caution bro.

We are not here to compete with each other. I hope everyone agrees? If we can be respectful and accommodating of opposing views that would be great. I wish you goodluck with your investments mate.

Mankind2024:
Paul Jegede's reputation and integrity are comparable to those of Mr. Wale Tinubu. Notably, he even ventured into cryptocurrency businesses at a point, demonstrating his willingness to explore opportunities where there is none.

Unfortunately, I can't defend him. I was unimpressed when he ventured into the quarry business after all the opportunities listing on the NSE afforded him.

I'm keen to see what comes out of the solid minerals mining and refining venture. There are opportunities not just for Japaul but for Nigeria as a whole in this space. I won't be holding my breath though.

bovali:
Don't worry, like i said earlier, i will not speak on Oando again. But this Japaul, I hope its not this equipment rental that you are looking at as long term revenue? Okay o. DD advised as always

Ok, I see you point. You don't consider revenue from rental income worthy of mention which is fair enough. However, note that that has always been their business model. They started out leasing equipment to the O&G industry - barges, tug boats etc. Then they added sand dredging and leasing of dredgers. A few years ago, they veered into the quarry business and have now recently shifted focus to solid minerals mining.

Recently, they announced a private placement to a foreign investor at N2.50 which is awaiting regulatory approval. I reckon it's the reason the share price has been trading sideways for sometime now. I guess the market is awaiting the finalisation or confirmation of that deal and the forward plan.

Please note that I'm not placing a BUY on Japaul just providing my own commentary. I expect everyone to do their own DD.

Gentle warning to anyone who might be considering making an investment decision on Oando due to my post: Please don't!!!

You are more likely to lose than make money in the stock market (particularly in stocks like Oando) so be guided and consult your financial advisor before making any investment decisions.