Business
Afreximbank Opens Shareholding To Investing Public
Supranational Trade Finance Bank, African Export-Import Bank (Afreximbank), says it is opening its shareholding to the investing public with a 300 million dollars equity offering through the issuance of depositary receipts.
A statement by the bank’s Head of Communications, Mr Obi Emekekwue, yesterday said that the equity offering would be held under its Class “D” shares.
The Tide source reports that the bank’s Class “D” are fully paid shares which can be held by any investor.
The deal, whose listing has been approved on the Stock Exchange of Mauritius, subject to raising the funds by September 30, is being handled by SBM Group, a leader in the financial sector in Mauritius.
The equity offering is the first time a supranational bank is issuing depositary receipts through an African stock exchange.
The President of Afreximbank, Dr Benedict Oramah, said that the aim was to enhance the bank’s capitalisation in order to significantly narrow the trade financing gap in Africa currently estimated at 120 billion dollars annually.
Oramah said the seed funds would enable the bank meet its strategic objective of growing intra-African trade in all regions of the continent, including island economies.
He said the bank had chosen Mauritius because, it had conducive regulatory framework for this innovative equity offering.
“On the other hand, SBM possesses the competencies, investor contacts, and support capabilities for the issuance of the depositary receipts.
“The depositary receipts issuance represents an opportunity for Afreximbank to diversify its shareholder base by enabling investors in Africa and beyond, who have not yet invested in the bank to do so.
“It is also to strengthen Africa’s premier trade finance institution whose interventions in its various member countries have created acknowledged developmental impacts across the continent,” he said.
Oramah said he was optimistic that the novel issuance would further deepen Africa’s capital markets and pave the way for similar issuances by other multilaterals.
Kee Chong Li Kwong Wing, Chairman of SBM Holdings Ltd, said it was a privilege for SBM to have been saddled with the responsibility to execute such an important transaction.
Li said it was high time global investors tapped into Africa’s huge potential by investing in Africa.
Afreximbank shareholders are a four-tier mix of public and private entities with Class “A” consisting of African states, African central banks and African public institutions.
Class “B” is made up of African financial institutions and African private investors, while Class “C” consist of non-African investors mostly international banks and export credit agencies.
The bank’s two basic constitutive documents are the Establishment Agreement which gives it the status of an international organisation and the Charter which governs its corporate structure and operations.
Since 1994, it has approved more than $51 billion in credit facilities for African businesses, including about $10.3 billion in 2016.
Afreximbank had total assets of 11.7 billion dollars as at Dec. 31, 2016 and is rated BBB+ (GCR), Baa1 (Moody’s), and BBB- (Fitch). The Bank is headquartered in Cairo.
Some Commercial drivers in Port Harcourt have said that the Federal Government’s N1,350 fuel discount is yet to reduce their daily operating cost.
A cross session of commercial drivers who spoke to The Tide correspondents in Port Harcourt said they are yet to feel the impact of the government discount, adding that most filling stations in the city are even selling above the pump price
A driver Jude Ogbo who operates the mile 1 Rumuokoro axis of Port Harcourt said plies the discount has not reflected in his daily fuel expenses.
“Since the discount was announced, many filling stations still sell at the old price. When you go there, you discover they sell you two litres at the price of one. For now, we have not seen any reduction,”_ he said.
Another commercial driver, Comrade Ishmael Uzeho who operates within the Port Harcourt metropolis, said the discount is not being implemented across the country.
“How has the discount affected us? I will say it has not. Many stations are not working. Only NNPC is working and that is just one person in the whole country. If government really wants to help, let the fuel price go down properly,”_ he said.
Uzeho added that if the price of fuel goes down, transport fares will also go down. He noted that his route fare has remained at N500.
On his part, Mr. Moses Dapa, Supervisor at Sam Jaja Foundation Transport Company, said the company has not increased its fares despite the high cost of fuel.
“We are still running normal price. We charge N2,000 and N5,000 depending on the destination. We will not increase our price. I don’t know about other parks, but for Sam Jaja, we are maintaining normal price,”_ Dapa said.
He appealed to passengers to understand that drivers are not using high fuel price as an excuse to charge excessive fares.
Other drivers who spoke said the federal government should monitor the NNPCL retail stations to ensure that the directive is implemented.
Recalled that The Federal Government in abid to reduce transportation cost in the country had announced a 30-day margin discount at NNPC Retail stations across the country from October 1 to 31,
However investigation revealed that the policy is yet to affect transportation cost in the country.
By; Stephens Sopakriba and Saint Davies
In a press statement released to The Tide’s source on Friday in Abuja, the group said Nigeria had a significant resource advantage due to its vast natural gas reserves.
“At a time when global energy markets face unprecedented volatility and rising operational costs, Nigeria stands on a massive resource advantage with its vast natural gas reserves,” the group said.
Highlighting this potential, Alfa Designs urged the nation to move past complaints over energy costs and aggressively embrace Compressed Natural Gas (CNG) as a sustainable engine for economic growth.
While federal policy adjustments have sought to cushion the impact of global energy shocks, industry experts emphasised that long-term relief hinges on a rapid, nationwide transition to gas.
“Transitioning away from expensive traditional petroleum products promises to ease the financial burden on ordinary citizens.
“It will also reposition Nigeria as an attractive industrial hub capable of drawing foreign direct investment and driving job creation,” it said.
To demonstrate the practical feasibility of this transition, the group said it recently partnered with a global Original Equipment Manufacturer (OEM) to lower the entry barriers for commercial drivers.
“By negotiating directly with the manufacturer, we reduced the total cost of acquiring and installing a CNG conversion kit for commercial tricycles (commonly known as Keke NAPEP) from up to N700,000 down to under N450,000.”
The group said this shift offers dramatic immediate financial benefits for local operators, with petrol currently selling at roughly N1,390 per liter.
It said that, in comparison, at a CNG equivalent price of about N98 per liter, a daily commercial driver using 10 liters of fuel reduces its daily energy expenditure from N13,900 to N3,980.
“This represents a daily net savings of N9,920, or more than 71 per cent.
“Over a standard 26-day working month, drivers save over N257,000, allowing them to fully recover the cost of the CNG conversion in less than 46 operational days.”
The company further stated that when scaled nationally, the economic implications are monumental.
“Nigeria consumes approximately 50 million liters of gasoline daily, costing roughly N69.5 billion per day.
“A nationwide 71 per cent reduction in fuel expenditure would generate daily national energy savings of N49.6 billion.
“On an annualised basis, this shift equates to approximately N18.1 trillion, or $13.5 billion, kept within the domestic economy.”
The group added that those recurring national savings would offer a vital mechanism to help address Nigeria’s estimated $2.3 trillion infrastructure deficit.
It said reinvesting those funds into the economy helps eliminate the 30 to 40 per cent operational overhead currently consumed by imported fossil fuels.
“The resulting boost to corporate margins expands the national tax base, generates reliable user-fee revenues to make major transit projects bankable, and creates a self-sustaining financial cycle,” it said.
