₦airaland Forum

ositadima1:
Dividend analysis: These appear to be the top dividend payers. Look at the dividend yield and the projected yield, assuming a 30% increase in dividend payouts. They are far below the returns from bonds and treasury bills if purchased today. I anticipate we will see corrections, as I don’t foresee prices rising significantly in the near future unless we’re surprised by a substantial dividend increase. Of course, this is purely a dividend analysis.

do u mean u are expecting price to drop so yield could get nearer to / equal bonds and treasury bills yield?

megawealth01:

Na why the admin expense they high be this triple digit billions

GeeKudi:
That clause was actually from the shareholders at the AGM. The popular opinion for adopting it was to prevent the flooding of the market with excess shares without notice.

Without that clause, OANDO would have been trading at #50 this morning.

u sabi

ositadima1:
That is why some of these Ogas, old in the business, like Emma, should advise newcomers to read about a stock using available sources and draw their own conclusions, rather than stubbornly promoting their own biased views. Honestly, I wasn’t thinking about the stock market back then; I was preoccupied with other things. But, the more I study Oando, the clearer the picture becomes. It seems more like a business transaction gone wrong ten years ago than the “Tinubu playing games with investors” narrative often repeated here. As an intelligent person, it’s better to take other people’s interpretations with a grain of salt and conduct your own independent research. Please note, I’m not saying anyone is a saint.

Emma's comments were also helpful to some during the period at least it would have triggered some people who understand that it is their own PERSONAL money they are staking to do some research and come to their own conclusion if they were DILIGENT enough.

Having said that i made a treatise on promotion of own views some few months ago (see my response to Oga Karl around October 24th) which were my own personal conviction of operating in public spaces.

Conclusively, OJT also didn't help during those period because he wasn't communicating to the public (minorities holders) clearly enough of the real challenges coupled with the fact that his cowboyish antecedent of acquiring Unipetrol was still a bitter taste in the mouth to some establishment people and the fact that around the same time he was disposing off some good numbers of Oando subsidiaries then (apparently in hindsight now was to pay down on some of the obligations on the same conoco deal that had hook him in the throat).

But in this particular case my personal reading of the issues is that he was fair enough (though could still have been better).

Selah

ositadima1:
From the 3-hour 45th Annual General Meeting of Oando PLC, I suggest starting from the final hour to listen.

Mr. E. K. Osaku, the Independent Non-Executive Director of Oando PLC and Chairman of the Statutory Audit Committee, provided the following explanation (this is a transcript I prepared):

Going by above explanation, i think OJT was fair in this particular case and it is just fair to mention same

i remember this period (Ansbury) very well. he was particularly fighting an existential threat then.

he got money from Ansbury (i think Volpi) and Mangal to conclude the Conoco deal then. Unfortunately after conclusion price of oil went drastically down along with all projections on which the conoco deal was done hence he couldnt repay. Volpi and Mangal want their money back or take over the company. i think the aftermath was the loan which led to the current share repayment/ bonus

chimex38:
A whole WAPCO Merger & Acquisition Valuation don like you?

My Oga no vex d tin pass my little education.

I no even know d maths formula wey i go use.

I know no weda make i use bodmas or Pythagoras.

Calculus i no sabi. Oga Agba fit sabi dat one.

I dey siddon look mode

KarlTom:
In recent times, most of the news from/about OandO are not easily understood...

Haaaaaaa. If a whole Oga Karl wey go Grammar school no understand this one den in Fela voice d tin be ODOO (overtake don overtake overtake)

Na siddon look i dey nowwww ooooo (in Bola Ige voice)

HesInMe:
Win-win ke? If I owe you $1 million, and instead I offer to pay you either a) $1 million in cash, or b) $1 million equivalent in Oando shares at today's valuation (as bonus shares, which are dilutive) which option would you choose?

How is this even legal?

My broda no vex.

I don give up. My night school education no reach the level wey Oando dey take am to. A whole Professor Agbalowomeri don talk say na Calculus.

D time wey dem wan teach us that topic for night school na hin palm oil finish for inside the lantern wey we dey use see for night.

So biko no vex d tin pass my paygrade.

Agbalowomeri:
E reach Oando turn, bonus becomes calculus

After d calculus, Pythagoras theorem sef dey.

My night school education no reach this one.

I don leave am for those who go Grammar school.

yMcy56:
* OANDO is giving shareholders bonus shares
* This bonus will be pro-rated....e.g. 1:10 (1 new for every 10 held or as the company deems fit (na example I give here ooo)
* This bonus shares came about as a result of debts owing OANDO by one of the debtors
* The initial plan was to pay this debt to Oando in a space of 15yrs ....But..
* They opted to pay in kind and with shares.......I think by forfeiting some of their OANDO shares.....
* This forfeited shares will then be distribute to shareholders
* Qualification Date is today OR within 5 days after today.
* This will be communicated to shareholders soon

** This is my understanding of it so far....
We will get more clarity if there's any again

Ohhh ok. Thank you very much.

It is much clearer now. O & O wants to settle some of its debt with part of their holdings in Oando then those shares would be distributed to other shareholders

A very ingenious and creative scheme.

If O & O bought those shares in the days of sub 10/20 ( which i very much suspect) then its a win win for all sides, i.e. O &O, minority holders and the coy (Oando) itself. The losers are those shareholders that O & O bought from, because technical it is the gain they couldn't wait to collect that is being shared by all other parties.

yMcy56:
Nothing like cash option!
It's only bonus shares in pro rated basis.
Ratio to be determined.
Where will the company get cash to pay shareholders?
Make Una collect your shares jejely and thank God as well as the management of O & O.

Hello Mcy. I dont seems to understand all this arrangement. Can you please help brake it down.

My people i dont understand this bonus thing (with Oando). can someone please help brake it down. Is bonus being given to every shareholders?

sterlingD:
Oando don drop

OANDO Q 3 2024


https://doclib.ngxgroup.com/Financial_NewsDocs/42713_OANDO_PLC-_QUARTER_3_-_FINANCIAL_STATEMENT_FOR_2024_FINANCIAL_STATEMENTS_DECEMBER_2024.pdf

I beg wey my popcorn dealer ooooo. Make he supply me enough quantity to last one week 😄. Show wan begin

Agbalowomeri:
Lol see how you are planning Elumelu's estate for him Person wey na Otedola woke from slumber. If not, by now you go dey receive exceptional items back to back

No mind am he was ok with low share price to justifies low dividend payout, before that one nearly pounce on him.

meanwhile them know how dem dey sort themselves from the topline before he get top bottomline

BabsO2:
After the RI and records are updated it will be clear if Tony took more UBA. This may only be know after about 6 months.

Buying the RI at a price higher than what the retail market offers injects money into UBA for the benefit of all shareholders. This is unlike a major shareholder buying up shares in the market to raise prices by injecting money into the hands of traders without long term benefits in terms of enlarged shareholder funds. I like this approach by Tony. This makes me give UBA a long term value (treasure) stock rating. This rating means those currently holding UBA should not sell it, but rather look for other shares to sell should they need urgent 2k.

my statement is as concern only the bolded.

He is definitely going to take up more. he had alluded to same during last AGM to the effect that he is savings his own dividend up to take up his right and more if possible.

BabsO2:
I think he will take more of UBA (and help us too by creating new higher price support for UBA). Doing rights at a low price would have resulted in a lower price support for UBA.

u sabi, plus another advantage is it help prevent the Ote$ effect/threat (hostile takeover)

this is an example of situation where our (retail investor/minority) interest (better pricing) aligns with that of mover/shakers.

Olaide1295:
Bought at 70.5 yesterday, I’ll be buying more, wish I could sell off my Tbills and hold WAPCO instead.
Wapco has about 50-60% potential upside (assuming 100 naira sale price at end of 2025) while fixed income is less than 30%.

but carries a bit of more risk than most fixed income (i am assuming sovereign). hence the reason for difference risk premium on both asset

KarlTom:
Dey play.
People are still chasing FMN at <5% profit...

The 104 or 146 is not official figure so we cannot predict.
I expect JIJOists to enjoy this one from next week...

ohhhhh i tot the 104 is fixed

Sunrisepebble:
There’s a fixed price of 104 already. The price is 70.15 now, representing at least a 48% upside, why will investors not continue rushing it until the premium percentage is non existent. I made sure to say at least because me I’m staying put in case one shareholder who gets mind wants to drag it higher than the fixed price

you can expect investor to stop chasing it when the differential between the market price and the fixed price is between 20-25% (around fixed deposit / TBILL rate)

emmanuelewumi:
Next week go loud for Lafarge, should get to N80 before Christmas

80 sir? I am positive that is understatement. If the hint that sunrise gave comes to past. I believe 120 should be more fair. The acquirer paid equivalent of 130 something for a similar coy in a market that is not as big as Nigeria and a company that is not debt free as Wapco.

pluto09:
I just remember the oando reverse takeover of one exile company around 2011 during the good day of SMN.
Na so we almost scattered our brain trying to understand those cowboys then.
This was one of the issues that made me respect sir wanajo so much.
Those who are interested in the story might check this link.
https://www.oandoplc.com/press-release/frequently-asked-questions-on-oando-plc-and-exile-resources-inc

Na that one carry Wale go Canada stock exchange that time b4 he run away from dir head off to joburg

He don teyyyyy

BabsO2:
Please share the grievance at the AGM politely. All for the better.

Which grievance am i sharing at the AGM. A management/board full of ivy league trained lawyers/accountants/ management experts does not know basic/rudimentary corporate governance practice. That would be an insult on their education.


Abeggiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii. Nextttttttttttttttttttttttttttttttttttttttttttt

HesInMe:
Oando shareholder here. There is nothing positive about this.

Unless accounting has changed under Professor Wale, accounts receivables (AR) are sales that Oando made to customers and booked as revenue but hasn't collected cash. And there's a (bad) reason why not. It is not good when your customers have problems raising cash to pay you, "asset-rich" or not. And if you want to liquidate those ARs, which fool will stand ready to pay you face value for the privilege of being owed by those "asset-rich" debtors?

And please stop the special-dividend delusion. First, that AR has already been booked as revenue; it is not some new income. Second, a company as indebted as Oando is cannot be paying dividends. At minimum, that would probably violate their debt covenants. Creditors want their money first before you pay shareholders.

So why this weird proposal? I suspect, but do not know for sure, that it's got to do with concerns about recovery of the AR and the arcane, I-am-too-sharp-for-myself deals that Wale & Co have been doing behind the scenes. Instead of writing down the AR, which would negatively hit revenues, they're trying to shuffle the deck. Unless I'm missing something, that can't be good for minority shareholders. Perhaps I should've sold at N90.

Another good perspective. and i cant help laugh at the " I-am-too-sharp-for-myself deals that Wale & Co have been doing behind the scenes"

Summary of your perspective (for the benefit of non accountant) if true is that Ojt want to substitute bad debt on its book with dead coy shares in our pocket instead of taking a provision / write down of the bad debt which would have negative impact the P&L


hmmmm it is well

megawealth01:
Wale sabi corporate governance practice?

we dey think say hin don repent. But a leopard ...............................

lolllllllllllllllllllllllllllllll

yMcy56:
Alright sir.
I believed the shareholders to attend the meeting aren't dumb anyway.
They'll seek for clarification as well.

They are not dumb but a gun is being put to their head how much of intellect can be use in such a case

I opened my statement with lets call a spade a spade for a reason


n.b no matter how it goes i stand to make substantial gain by virtue of positioning but that doesnt mean we should not speak the truth. This is not a good corporate governance practice

yMcy56:
On this OANDO matter,
I hope we can all read what the AGM agenda says?? because all these Nsempa twists, I'm not understanding......
**Says those who owe the subsidiaries and would be resolved to pay back with share allotment.....
**Then this will be distributed to shareholders..... minority shareholders probably, as form of some bonus shares possibly.

So, what's all these over analysis and big grammar twists all about?
Una don start again o.
If you don't understand, wait till AGM date for clarification, make una no come confuse person with paralysis here. 😁

Mcy let call a spade a spade. There is no paralysis. it is Oando in its usual characteristics and antecedent that is muddling up the water. Good Corporate Governance dictate that more information (than this) should be made available for a key decision that require voting. its like blindfolding person to a voting center meanwhile the ballot paper had been designed such that the choice the organiser want is covering 99% of the ballot paper, what is the probability that the blind folded person would thumb print the remaining 1% space. In addition making any further information available on the AGM date is like putting a gun on the head of the voters. if Oando really want its shareholders to make informed decision then ALL NECESSARY information should be made known on the same date that the AGM meeting is being called (i.e. at least 2 weeks prior to the meeting).

The Management/Board of Oando know this, they are just not doing the right thing, which points to the fact that nothing much has changed.

Selah

BabsO2:
Maybe not mago mago but giving something back to long suffering shareholders. As he cannot deliver dividends right now he wants to share some other goodies perhaps

There is nothing being gave back. The companies are already owned by Oando Plc, so which debt is supposedly being settled (with shares) between two companies owned by same shareholders??

Except he is unbundling (like Afriprud and UCAP a la UBA) which is a business that goes beyond AGM

Abeggiiiiiiiiii nextttttttttttttttttttttttt

Omooloriredade:
It is impossicant. It won't happen. NNPC will never cede shares to Oando or settle debt owed (if any) to Oando in shares.

Also, NNPC can not be classified as a related entity so NNPC is out of the equation in my opinion.

The pool of likely related entities is quite a large one. It's too much work to list them here but if you comb through the annual report you will see the possible culprits there. Debt owed is about N215B.

Disclaimer - I have been wrong many times before but this is my own understanding. Please note that the flag I'm raising here is white, not red nor green. Money can still be made and lost. It is the market afterall.

But Oando own all these related parties either directly or indirectly. In most (if not all) the companies Oando own 100% so what debt is being settled with shares? are these so called debt not suppose to be intercompany which is in and out and of no effect upon consolidation

Ojt don come with mago mago again

Omooloriredade:
Sorry to say, it is highly unlikely.

NNPC a state-owned corporation will settle debts to a private company by alloting shares in the corporation owned by Nigerians? Oando and Tinubu would be looking for trouble be that.

Disclaimer - Chai! For me, hard to reason am that way but anyway make we dey watch.

I totally agree with you on this. i dont see the practicality. This is leg deep in national politics and i doubt if it can be pulled through

Omooloriredade:
No be attack o. Just an opinion which has no bearing on how the market will react to the news. So here goes:

What is huge? Make we know first. The information in that annoucement is slightly insufficient to make a sound investment judgement. There's not enough meat on the bone.

Resolution 3 Summary:

* Related entities owe Oando subsidiaries in the course of doing business together.
* A special resolution is being proposed to have the debt owed transferred to Oando the parent company.
* Debt due date will be brought forward and renegotiated (with or without modifications).
* Further to above, Oando is proposing to have the debt settled by accepting shares in the debtor entities (i.e Debt for equity swap deal).
* The debt for equity swap is intended to help reduce the overall Trade receivables (not payables o) at the group level.
* Shares allocated from the debt to equity conversion is then distributed to existing shareholders of Oando on a pro rata-basis.

Questions:

1. Who are the related entities owing Oando subsidiaries?
2. What is the status of the financial health of these entities?
3. Why are they unable to settle their debt as and when due?
4. Trade receivables are revenue owed to a company from the sale of goods and services. Is buying shares in these onigbese companies the best use of company resources?
5. Can Oando reveal the related entities and if possible provide a brief summary of their financials so shareholders can make informed decisions before voting on these resolutions?
6. Would it be better to instigate an asset sale by these entities and the proceeds used to settle Oando loans or Trade payables?
7. Do these related entities pay dividend?
8. If not, are they listed on the NASD or NGX to provide an exit platform for shareholders should they decide to leave? Or at least convert their own portion of the shares to cash. Don't give me something I can't monetise.
9. Oando has quite a number of subsidiaries and related entities. Which ones are we talking about here?
10. Bonus question - Is there a subsidiary or related entity Wale and Boyo are not shareholders of? Hmm, Wale why are you not paying up for for good and services rendered?

Positive:

1. If the related entities are Asset rich but just suffering a temporary cash crunch.
2. Deal is done at favourable valuation for Oando shareholders i.e entity shares are not overpriced at conversion.
3. OODP (Wale and Boyo) will not be voting. Outcome lies solely in the hands of minority holders (same as the delisting in case anyone didn't know that).
4. Huge positive - converting trade receivables to shares in an asset rich company and transferring same to existing shareholders could be the company rewarding existing shareholders. Basically, the company is proposing to pay out a portion of its income to shareholders. A dividend of some sort. In a way, Question #4 could be a blessing even though Oando still needs to address its huge debt too.
5. Qualification date for this distribution is the date the resolution is passed. Note this one. 17/12.
6. The directors might be seeing light at the end of the tunnel, hence their decision to go this route. Otherwise, it shouldn't be the near-term course of action. Settle your own gbese first before thinking of rewarding shareholders (that is if it's a reward o. It might well be a curse especially if it could have been better spent for the overall good of the company and to reap the reward latter).

Disclaimer - My 2 kobo. My post could be grossly misleading so please DYOR. Not a recommendation to buy or sell Oando.

Oando go turn so many people into Professor last last. See detailed analysis. Well Done

Sunrisepebble:
https://www.globalcement.com/news/item/13460-huaxin-cement-completes-acquisition-of-plants-in-zambia-and-malawi-from-holcim

if the news of buyout/delist flies below are my night school analysis of what a fair price should look like


Lafarge (Wapco) back of envelope possible buy out price (going by link shared by sunrise)

Hoacin bought Lafarge Zambia with a capacity of 1.5m/t for $150m for 70%

Meaning 100% of Lafarge Zambia is priced at $200m for 1.5m/t which equals $133m for 1m/t capacity

Hoacin bought Lafarge Malawi with a capacity of 0.25m/t for $10m for 100% which equals $40m for 1m/t

Above means Hoacin paid an upper of $133m for 1m/t capacity and a lower of $40m for 1m/t with an average of $89m for 1m/t

From above for a Lafarge Nigeria with a capacity of 10.5m/t the

Upper buy could be 10.5 by $133m equals $1.4bn @ 1600/$ gives N2.24 trillion with outstanding shares of 16.11bn gives a valuation of N139 per share

The average buy could be 10.5 by $89m equals $935m @ 1600/$ gives N1.5 trillion bn with outstanding shares of 16.11bn gives a valuation of N93 per share

Lower buy could be 10.5 by $40m equals $420m @ 1600/$ gives N672 million with outstanding shares of 16.11bn gives a valuation of N42 per share

So we have three possible scenario of N42; N93 and N139

42 is already affirmatively broken, so maybe we could test 92 next (if no info comes out before it gets there)

Selah


i have some few units of Wapco so i might be blinded by sentiment

Sunrisepebble:
The details are still not clear to me, just relating what my source said. I think it’s the former though

Ok. Thank you.