ARMELOPOST » Nigerian Stock Exchange

Briefs on the Financial Crisis and Africa

Armel — Tue, 07 Oct 2008 17:52:27 +0000

This is their best opportunity to take control of the entire region given their strong market cap, tier 1 ratio and strategic goal. All this is happening while the corporate parents of major European Banks operating in Africa have to show restraint in face of the global financial crisis.

SHARP FALL on the NIGERIAN STOCK EXCHANGE and The needed BAIL-OUT !!

” The Nigerian Stock Exchange (NSE) dropped N46 billion to close at N9.684 trillion at the end of trading. The All Share Index dropped 207.72 points to close at 45,504.69 points. The market has been on a continuous fall in recent weeks. The capitalisation dropped by N54.5 billion last Thursday, which was the first day of trading this month. It dipped further by N52.7 billion on Friday. “ But Is it feasible to pull a BAIL-OUT entirely sponsored by private funds in Nigeria now ?

REMITTANCES from the DIAPORA in DECLINE

Obviously this will come as the latest downward trend from the economic crisis on the micro level in the US where growth almost ceased in the booming construction sector. The ripple effect in the temp and contract jobs where most immigrants find the bulk of their remittances is in jeopardy. The Hispanic Community can already feel the crunch

Sources: AllAfrica.com, Wall Street Journal, The Nation, Le Jour

Private Equity in Africa: A Solution

Armel — Thu, 04 Sep 2008 21:06:51 +0000

PRIVATE EQUITY MIGHT BE THE LONE INVESTMENT OPPORTUNITY IN MOST COMPANIES in AFRICA.

While many countries on the continent don’t do enough to promote their launched stock exchanges, some others simply do not have any. The success stories in the exchanges in Ghana, Nigeria, Kenya cannot erase the fact that there are simply way more outstanding companies still privately held.

Closely held family owned and managed companies are the norm on the continent for many reasons that I don’t find necessarily true. Worries about ownership structure shouldn’t keep people from cashing-in or profiting if there are investors willing and attracted to a steady stream of income from established profitable ventures. We can find many examples in Africa where privately held assets are underperforming because the current owners just don’t or won’t see further than their current way of doing business.

To be honest, It can be scary to attempt bigger achievements with your business on the continent if you are not prepared for all the adverse side effects.

To showcase this focus, I will later take a few shots at it by presenting examples of sectors or areas where despite well known profits over the years, everyone can benefit from fresh capital inflow, better management or integrations. (If we agree that ”income perpetuity” is the long term goal)

To be continued in next posts…

ECOBANK launches Biggest Stock Sale in Africa!

Armel — Tue, 26 Aug 2008 08:00:21 +0000

Ecobank Transnational plans to sell $2.5 billion of shares, in the biggest stock offering in Africa !

The combined offer of stock to existing shareholders and to the public will be held simultaneously on three west African exchanges in Nigeria, Ghana and Ivory Coast, Lome, Togo-based Ecobank said in a statement. The offer opens Aug. 25

“The proceeds of the offer will be utilized to further strengthen Ecobank’s accelerated growth plan to expand its network of branches in countries where it currently operates,” Chairman Mande Sidibe said in the statement. The bank will open new operations in countries on the continent where it has no offices.

Ecobank’s stock offering will take place on the Nigerian Stock Exchange, the Ghana Stock Exchange and the Bourse Regionale des Valeurs Mobilieres in Abidjan, Ivory Coast, Ecobank said.

Almost 3.76 billion shares are being offered to existing investors at $0.27 apiece at a ratio of five new shares for every nine held. Another 5.12 billion are being offered to the public at $0.29 each.

This implies a discount of 20 per cent for the rights offer and 12.5 percent for the public offer to the 30-day volume-weighted average price of the company’s stock across the three stock markets where it trades.

From: Leadership Nigeria

Other S/ces: Bloomberg, Business Day Nigeria