Economic perspective and analysis by Afripol Organization www.afripol.org
The West African energy giant, Oando Plc of
Oando Plc headquartered in
Oando Plc will raise the capital “through a Right Issue of 301,694,878 ordinary shares of 50 kobo each at N70.00 per share on the basis of one 1 new ordinary share for every 3 ordinary shares of 50 kobo each held as at the close of business on Friday, 18 December 2009.” Two powerful and resourceful companies in the capital market: Vetiva Capital Management Ltd. and Stanbic IBTC Bank Plc will participate in the selling of the shares to raise the proposed capital.
The capital market venture was announced by the CEO and Group Managing Director, Mr. Wale Tinubu at the end of the meeting of the executive board of directors. According to Mr. Wale the company planned to raise the capital for the refinance its acquisition of upstream assets.
The achievements of Wale Tinubu, the erudite and efficient chief executive officer must be acknowledged as a driving force at Oando Plc for his vision and leadership. Under his strategic leadership Oando‘s growth has been tremendous thus appreciating the shareholders’ dividends.
During the press conference Wale reaffirmed, “the size of the business we run at Oando Plc would require a substantial amount of capital. We are doing things in several stages. The one we are doing now is Right Issue which is a small amount of N20 billion for the recapitalisation process. Then we will be proceeding to do a much larger international equity Issue which would occur at the beginning of the second quarter. Then there is going to be two debt issues. One is a local five year debt issue which we are working on right now and the mandate has been signed, it’s in the final stages.”
Wale further emphasized: “the final thing would be the bond issue. We are in the process of fund raising the debt restructuring 5 year term for N60 billion. Then we would do an international equity and debt raising of N75 billion which would come in the 1st week of April (second quarter). The bulk of the money is going into our gas and upstream division for the upstream, we have our crude oil. You are aware; we have diversified heavily towards increasing our production in the crude oil sector.”
The bold move made by Oando Plc buttressed the company’s growth and strong confidence even in the turbulent oil industry especially in
Oando Plc is listed on both Nigerian and Johannesburg Stock Exchanges, and has been concluding the arrangement to be listed in London Stock Exchange.
Recently it was reported by Reuters that “Dow Jones Capital Markets Report reported that Oando Plc had signed Memorandum of Understanding with Gazprom OAO. The two companies have agreed to collaborate on the development of oil and gas assets and infrastructure in the West African sub-region and the
Oando Plc is growing rapidly by increasing the number of oil rigs and “All Africa reported that Oando Plc has increased its fleet of oil drilling rigs to three with the acquisition of a USD 53.5 million rig, named the Constitution. Constitution, a swamp barge rig, has capacity for approximately 15,000 psi pressure output, about 3,000 horse power as well as the ability to undertake drilling operations, work over and high pressure/high temperature (HPHT) wells of over 30,000 ft drilling depths. The facility was purchased in July 2008, and was recently delivered to the Company. “
Emeka Chiakwelu, Principal Policy Strategist at Afripol, recently speaking at Energy Workshop noted that “Energy industry is capital intensive and continuously needs injection of large resources. The growing energy companies in
Oando Plc is gradually but steadily making impact in the energy industry, therefore the infusion of the 21 billion naira will strengthen and energized its business prospect.
Oando’s stocks are doing well in the stock market in spite of the global economic downturn. Oando Plc must widen its scope beyond Africa and venture into new territory particularly in East Asia and
Oando Plc has the potential and the credibility to become a major player in the global energy industry in 21st century.
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