02 Aug

Daily Watch – FG remembers dead ₦61b Katampe project, 9mobile gets loan extension

  • The FG says it has mobilised more funding for the speedy completion of the abandoned ₦61 billion Katampe Infrastructure project, which was granted under the Public-Private Partnership concession between the FCT, the World Bank, and a consortium of engineering services firms. The project, which started in 2010, was expected to be completed in three years but is currently only 20 percent gone due to lack of adequate funding, a situation that led to its abandonment. According to the FCT Minister, Muhammad Musa Bello, “For us at the FCT Administration, this is a project we will ensure it succeeds simply because it will open the way for us to be able to replicate it in similar projects within the city.”
  • The Katsina State Government on Tuesday defended a $110 million (about ₦34.5 billion) loan request from the Islamic Development Bank before the House of Representatives Committee on Debt. The State Commissioner for Health, Mariya Bala Usman said the proceeds would be used to erect 136 health centres in the 34 local government areas, including a teaching hospital for the three universities in the state; a nursing school; an infectious disease centre among others. She said the loan, which is to be implemented under a four-year programme, would be converted to a grant by IDB should the government implement the loan agreement to the letter within the specified timeframe.
  • A group of Nigerian banks has agreed on an extension to a $1.2 billion loan made to 9mobile, formerly known as Etisalat Nigeria, pending the mobile operator finding new investors, FCMB bank said on Tuesday. Nigerian regulators stepped in last month to save Etisalat Nigeria from collapse and prevent lenders placing the country’s fourth biggest telecoms group into receivership, prompting a board, management and name change. Etisalat Nigeria took out a $1.2 billion loan four years ago from 13 local banks to refinance existing debt and expand its mobile network, but it struggled to repay due to a currency crisis and a recession in Nigeria. FCMB, which is owed ₦4.5 billion by the telecoms group, said lenders had put a hold on taking provisions on the debt and that they were working with the regulators. The banks, many of which are reporting first-half results, have been trying to work out the value of 9mobile before deciding whether to impair the loan or wait until the company finds new investors.
  • Dangote Industries sold a 2.3 percent stake in Dangote Cement to foreign investors on Tuesday in a stock market deal valued at ₦86.1 billion ($236 million). The cement maker has been selling small stakes to increase its free float, which is well below the NSE’s required level. An NSE spokesman said 416 million shares of Dangote Cement were sold on Tuesday at ₦210 each in six off-market deals negotiated between Stanbic IBTC and Meristem stockbrokers. The price was below Dangote Cement’s closing price on Monday of ₦223.75. Shares in the company, owned by Africa’s richest man Aliko Dangote, jumped after news of the share sale, closing up 7.3 percent at ₦240, valuing the company at ₦4.09 trillion n($11.2 billion). A spokesman for the cement maker said the deal was between Dangote Industries and some foreign investors, whom he did not identify.
  • Unilever Nigeria has scaled back the amount it plans to raise from shareholders via a rights issue to ₦58.85 billion ($162 million). The household products maker, majority owned by Unilever, had planned to raise ₦63 billion through a rights issue and said in April it would ask shareholders to approve the share sale. The company said on Tuesday it would issue 14 new shares to existing shareholders for every 27 held at ₦30 each, a 25.2 percent discount to Tuesday’s market price of ₦40.13. It said the rights offer, which opened on Monday, would close on 8 Sept. It planned to offer 1.96 billion shares. In July, the company reported a 238 percent rise in half-year pretax profit to ₦5.04 billion.