₦airaland Forum

robobo:
You are right. The acquisition was not financed by UBA but be rest assured UBA would have been part of banks financing working capital (loan / overdraft with a max of yearly tenor). That said, the CBN rule is actually a double edged sword. In that in most frontier/ developing market, banks mogul/ owners are always also players in other sphere of the economy unlike in very developed markets. So there might be a need to find a delicate balance instead of policies that engendered total prohibition

My take actually is that for such insider loan 50% provision should be ok for loan performing and procured at competitive interest rate (i.e. treated as a stage 2 ifrs) from day 1 of the loan.

BabsO2:
I suspect he’s also not happy with shareholders as he was left to shoulder a huge chunk of the rights.

I doubt this has anything to do with it. I am sure left to Tony he will have paid something no matter how small. The constraints must have been from regulator., coupled with up coming stress testing

Mankind2024:
It is a fundamental principle of financial integrity that one must not mischaracterize a transaction to suit a specific narrative—or, as the proverb suggests, "give a dog a bad name just to hang it."
​Regarding the acquisition of the 20.07% stake in Seplat Energy by Heirs Energies, there is no documented evidence or regulatory filing to support the claim that the transaction was financed using UBA Plc funds. Such a move would be contrary to the strict corporate governance and "Related Party Transaction" frameworks that govern Tier-1 financial institutions.
​The acquisition was anchored by major multilateral financial institutions, specifically:
​Afreximbank (African Export-Import Bank): Provided the primary credit facilities and long-term financing necessary for Heirs Energies to expand its portfolio.
​Africa Finance Corporation (AFC): Acted as a key institutional partner, providing the structured capital required for large-scale energy equity acquisitions.

https://businessday.ng/energy/article/heirs-energies-acquires-20-stake-in-seplat-energy-in-500-million-deal/

You are right. The acquisition was not financed by UBA but be rest assured UBA would have been part of banks financing working capital (loan / overdraft with a max of yearly tenor). That said, the CBN rule is actually a double edged sword. In that in most frontier/ developing market, banks mogul/ owners are always also players in other sphere of the economy unlike in very developed markets. So there might be a need to find a delicate balance instead of policies that engendered total prohibition

[quote author=Dupeodus post=139209076][/quote]Yes, the CBN prudential guideline seems to be tougher plus the fact that aside from the guideline, regulators (CBN) can tell banks to make provision for particular loan whether it is performing or not. They do this frequently depending on some other information that might not be available to the banks or related to the particular loan. That is why they are a regulator.

What the CBN is trying to achieve with the 100% provision for insider related credit (whether performing or not)is to force bank directors with interest in other businesses not to borrow from the bank they own/ are directors in. This will ensure that those other businesses they own does not enjoy interest rate subsidy from their directors bank and also ensure they dont tie down the bank they own with bad credit. In short it will force those other businesses to compete for funding with thier competitors at a fair rate

Agbalowomeri:
This is not a forbearance issue though. More like credit risk exposure

Very correct.

Dupeodus:
Bottom line. The profit declared is overstated by ₦187.515 billions as these should have been top line charges. I wonder why the CBN and the auditors would have allowed a material misrepresentation like this, hiding significant numbers like this in an obscure note and the statement of changes in equity that most people will not see. But for this post, I'll have missed it.

This is not exactly as u stated it (i.e. overstated profit). The mechanics of calculating impairment under ifrs 9 differs from the CBN prudential guidelines (as well as each countries prudential guideline). The rule per CBN is that if the CBN calculation is higher you transfer from your profit to the reserve but if IFRS is higher you maintain the figure from IFRS meaning you cant take out of the reserve. I suspect the difference will largely be because of the new 100% provision for insider related borrowings.

Meanwhile All Nigerian banks (and most international big banks all over the world) adopt the IFRS 9 standard for financial reporting, so their will always be a difference on impairment calculation every year. Thekey is the difference should not be as large as this one from UBA hence my thinking that it is from the new rule of 100% provision for insider related credit which is peculiar to UBA in this instance

[quote author=BabsO2 post=139194382][/quote]Ohhh. That was a response to a post by Agba. I stated it as "COULD" because no one can read wale's mind. Which is one of the reason i stated transparency and adequate communication as a key thing lacking from the management.

BabsO2:
Reserves valuation already support N429. Other synergies can boost it up easily to N500. But N1k is way off if there is no further devaluation.

Looks like you have muted the delist thoughts you shared earlier this year

I dont understand the bolded

BabsO2:
This steep valuation is not supported by hydrocarbon reserves valuation.

He go be like film IF/WHEN wale attends to those things i highlighted above.

mikeapollo:
I think Wale and his team went into upstream business (from downstream filling stations) with little or no experience whatsoever in the sector!
Probably the reason they bought Conoco Phillips at an overvalued price, among other issues.
The inexperience is the biggest challenge and undoing.
It could have been different if he had worked in the upstream sector e.g. in a global oil company like Shell, Chevron etc. before acquiring Unipetrol/Oando or if he had gone into partnership with experienced professionals in the upstream sector.

Oga Mike stop making excuse for him. the main problem is someone believing he is the smartest person in the room and pure ego. Even if he is not upstream experienced as at then he has considerable experience in midstream which though might not be equivalent to upstream but could still the called upon and networked to get requisite knowledge. So what about after more than 10 years post conoco, has anything been different??

Sunrisepebble:
For FY25 results, the book value per share of Zenith 4,924.206 / 41.07=N119.9 per share
Using Cardinal stone research forecast for 2026 their book value per share is 6,189.5 / 41.07=150.7 per share.
Seems the banks are now trading at 1/1.1x P/B. That gives you a fair value of N166
NFA/DYOR. This is rough maths

That means UBA will do N100 be dat ooooooooooooo Make i hold my thing then

Hmmmmmm

Though what we are presently having looks like a general bull market but i sincerely believe Nigerian banks will/ should reprice particularly after the recapitalization and possibly post the upcoming stress test. it is looking more like an aberration for Nigerian banks to be priced at the present valuation bands. Banks in even some more distress market dont price that ridiculously valuation band

mikeapollo:
Na wa ooo!
No wonder the expectation of 900mw power plant in 12 months.
You want Oando at N1,000 so that you can start competing with Dangote?
God dey ooo. Is it good?

Oga Mike

Read my comment well ooooo, there are conditions to that price

Oando has enough assets to achieve that price in the medium term. The challenge is purely Management. If Wale is fairly transparent, and he adequately communicates to the shareholders/ investing public how he intends to achieve those 3 conditions above, and the shareholders/ investing public can see judicious implementation of such plan for a while then the above price is well attainable.

megawealth01:
I don target 289 sha

My own na btw N500 -N1000 after the book is cleaned (1. negative equity cleared 2. Adequate working capital has been raised (so less dependent on bank borrowing) and 3. dividend restored)

feelamong:
Dont worry

TOE is still very busy with Seplat

once he is done, he will face UBA and push it to the moon

E be like say the Oga wan wan target Forbes next year.

I am suspecting that Heirs oil might become listed via a merger with Seplat.

This will help him consolidate his Upstream business, tighten his grip on Seplat (or the eventual entity from the merger) and also bring him into Forbes listing

nosa2:
Market is acting as if the Nigerian consumer is not suffering from sky high energy prices. Q1 results go do everybody like home video.

I am enjoying the ride but the shock is coming

Oga Nosa

The effect of "sky high energy prices" will not reflect in Q1 result. The war started at the end of February (67% of Q1 already done" while the effect did not materialize at the pump until about a week/two later meaning 75-80% of Q1 economic activities were already done.


My take is that the effect will be captured by the Q2/half year reports

Sunrisepebble:
Loaded Oando for JIJO today

"Àgbàlàgbà tí ó ń sáré nínú ẹ̀gún ọ̀gàn, bí kò lé nǹkan, nǹkan ń lé e."



An elderly person running in a thorny bush is either chasing something or being chased by something

mikeapollo:
So who do we follow now? The person looking forward or looking backward?
Just kidding

Follow who know/sabi road

Sunrisepebble:
Oando

https://www.reuters.com/business/energy/oando-plans-750-million-drilling-campaign-expects-funding-boost-iran-turmoil-2026-04-10/?taid=69d8d14850dfba0001005426&utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=twitter

Forward looking statement as usual

robobo:
The thing i have learnt about rough maths is that they work best. All others only move you further into the analysis paralysis spectrum

ciao

in line with "rough maths". It SEEMS btw 4 - 4.25 dividend is being priced into UBA if we are to use the yield on GT and Zenith (btw 9.2% - 9.8%) as a proxy. Anything farther from this (positively or negatively) might be treated as a surprise by the market.

Going by same "rough maths" / yield expectation, it SEEMS btw 2.25-2.5 is being priced into Access. Anything farther from this (positively or negatively) might be treated as a surprise by the market.

Sunrisepebble:
That would be a generational buying opportunity.
I’m not a bank analyst, so forgive my rough math. Assuming Zenith have exited their forbearance as at FY25, the way GT had in FY24. If they have GT’s level of impairment in FY26 and assuming earnings are flat and payout ratio is also flat. You’re looking at an EPS of N39 and a DPS of N15+

The thing i have learnt about rough maths is that they work best. All others only move you further into the analysis paralysis spectrum

ciao

KarlTom:
You have made a strong case for efficiency at Kwale. However, I don't think Phase II (additional 480MW) has been brought on stream. So we're likely dealing with just 480MW for now.

However,the 60MW turbine belongs to Bayelsa State (Yenagoa Power Project).
It will be powered with gas feed from the Oando gas manifold.

@ the bolded, It doesn't belong to OandO

Oga Karl. Your is the tenable reason for the talk. If na Bayelsa govt get am (60MW turbine) then it is tenable but for Oando being the owner when the full capacity of Kwale is yet to be fully exploited. It begs reasoning.

mikeapollo:
It is okay. Never intended this to be a back and forth issue. You are 10000000% correct and right!

Escape valve instead of facing the fact that it is possible within the time frame and calling out the actors

we have a long way to go

ciao

mikeapollo:
Maybe you did not read my earlier post very well.
My question was how do you expect them to do it in 12-18months; before you responded by making reference to Tony did at Ugheli

i replied you that the info is in public domain

"" Key Milestones and Achievements
Capacity Turnaround: At the time of the physical takeover on November 1, 2013, the plant was generating only 160 MW. Within just two years, Transcorp increased this by over 525%, reaching 620 MW by 2017.""


above states that Tony increase Ughelli capacity by 525% within two years of take over.

Not only that there was clear communication on intent by Tony all through the two years, is there any communication from Oando by now. i remember vividly that after the two years increase there was also clear communication by Tony that the target was 1000 and they will be partnering with GE to achieve same

let us continue to defend/ support mediocrityy/ cunningness/ greediness

mikeapollo:
Tell us if he did it in 12-18 months, immediately after he acquired it.
Transcorp Power transaction took place several years before now.

It is good to push Oando to do it, but I am not sure such was feasible in 12-18months considering the fact that it Is part of a larger set of assets acquired from NAOC

so the goal post has shifted from how to do it (as if it is impossible)? to how long did it took to do it (to it is possible but what time frame)

Okay ooooo. that will also soon cahnge becuase the information are in public domain

let us continue to defend/ support mediocrityy/ cunningness/ greediness

you have something that you have not fully exploited; barely exploiting 30-40% of its value then you go and buy an extra piece of the same thing. and start making media round to celebrate same.

its okayyyyyyyyyyyyyyyy

mikeapollo:
You may have solid points of concern.
just some curiosity:
If NAOC operated the power plants for several years and handed it over to Oando at only 300-350mw in Aug/Sep 2024, how do you expect Oando to move and almost triple the capacity to 960mw just after about 12-18months?

How did Tony increase the capacity of Ughelli?

Abeggiiii make una face front

Oando has not fully utilised the full 960MW capacity of Kwale-Okpai Power Plant but is going after / procuring another 60 MW turbine.

Bunch of unserious people. if they are serious, by now the utilisation of Kwale-Okpai Power Plant should have moved from the about 300-350 they took over from NAOC to its full capacity of 960 mw. Also talk should have been in place to spin it off as an entity standing alone on NGX thereby maximising its value and releasing some cashflow for Oando itself but i guess that is not immediately gratifying like the 60mw.

Unserious bunch.

[quote author=GeneralDae post=138962091]OANDO COMMENCES FINAL INSPECTIONS FOR 60MW GAS TURBINE

​Oando (formerly Nigerian Agip Oil Company) has mobilized personnel for a critical inspection of its gas manifold infrastructure.

This technical review is the final step required before releasing gas into the newly completed 60-megawatt gas turbine, ensuring all systems are primed for operational takeoff.

As the primary energy provider for the project, Oando’s successful "gas-in" process is the catalyst for the facility’s launch.

This milestone comes as Bayelsa State prepares for the official visit of President Bola Ahmed Tinubu, GCFR, who will formally commission the turbine along with several other signature projects in the coming days.

https://x.com/microsmoothie/status/2039380748130533553?s=46[/quote]

[quote author=GeneralDae post=138962091]OANDO COMMENCES FINAL INSPECTIONS FOR 60MW GAS TURBINE

​Oando (formerly Nigerian Agip Oil Company) has mobilized personnel for a critical inspection of its gas manifold infrastructure.

This technical review is the final step required before releasing gas into the newly completed 60-megawatt gas turbine, ensuring all systems are primed for operational takeoff.

As the primary energy provider for the project, Oando’s successful "gas-in" process is the catalyst for the facility’s launch.

This milestone comes as Bayelsa State prepares for the official visit of President Bola Ahmed Tinubu, GCFR, who will formally commission the turbine along with several other signature projects in the coming days.

https://x.com/microsmoothie/status/2039380748130533553?s=46[/quote]

alfajohn:
Please when will that be if you are in the know.

Na only Wale and SEC know that one.

megawealth01:
WALE push OANDO up so it can compete with ARADEL at least

That will be after we don finish our RI

mikeapollo:
The first was 1 for 12 (8.3% yield)
The second is approx. 2 for 29 (6.827%)

They miss the exact ratios and percentages in some fractions

Thank you Oga Mike. i got the ratios wrong.


but make dem sha let Wale breatheeeeeeeeeeeeeeeeeeee