Oando shareholders approve N80b rights issue

Shareholders of Oando Nigeria Plc on Monday endorsed the company’s plan to raise N80 billion through rights issue.

The shareholders gave the approval at the company’s 38th Annual General Meeting (AGM) held in Lagos.

They also approved the company’s plan to divest all shareholding and investment in the downstream business by way of sale, transfer or any other form of disposition to enhance growth.

They also authorised the company’s directors to appoint professional advisers and other parties to the transactions.

Mr Wale Tinubu, the company’s Managing Director, said divestment of the downstream business would be concluded in the next two years.

Tinubu said the company would also inaugurate the Apapa Jetty which would emerge Africa’s first midstream jetty in the next couple of weeks.

He said that the project would contribute significantly to the company’s overall net profit through tolling fees as well as reposition it for enhanced profitability.

Tinubu said that the company was committed to shareholders value, saying that the company would begin dividend payment in the nearest future.

“The divestment will reposition the company for a new era of investment growth and profitability, whilst enabling the Oando Group to focus on its midstream and upstream ambitions,’’ he said.

He said that the proceeds of the divestment would be utilised for debt reduction to shore up the company’s balance sheet in “these challenging times”.

“Our strategic focus is to increase our operational efficacy across our subsidiaries, deleverage our balance sheet and return the company to profitability,’’ Tinubu said.

The company posted a loss after tax of N179 billion for the financial year ended Dec. 31, 2014.

This was against a profit after tax of N4.68 billion posted in 2013.

The company recorded a turnover of N424.68 billion compared with N449.87 billion recorded in the corresponding period of 2013.

Similarly, the company for the six months ended June 30, 2015, declared revenue of N60.32 billion against N55.67 billion posted in 2014.

Its loss after tax stood at N34.68 billion in contrast with profit after tax of N5.74 billion achieved in 2014.

Tinubu said that the company’s profit after tax numbers were impacted by impairments of N76.9 billion in exploration and production, N16.9 billion in under lift and N7.3 billion foreign exchange losses, among others.