With the Nigerian stock exchange resuming this week, Seplat, Ardova and Flour Mills of Nigeria (FMN) are some of the stocks investors need to watch out for.
Ripples Nigeria stocks watchlist is a selection of stocks monitored for viable trading or investing opportunities. An investor may casually generate a list of equities for investment purposes. But we have taken the pain to do that based on certain parameters in order to save you that hassle.
Kindly note that Ripples Nigeria Stocks Watchlist is not a buy, sell or hold recommendation. It is advisable to consult your financial advisor before making any investment decision.
The Nigerian-owned oil and gas firm, Seplat, has been struggling to complete the acquisition of Mobil Producing Nigeria Unlimited (MPNU) from ExxonMobil, after announcing an agreement seven months ago.
President Muhammadu Buhari’s administration has been blocking the deal, and this might affect Seplat’s expansion plan, which is expected to grow its production level and revenue. However is causing disappointment to shareholders, as completion of the deal would have improved their investment value.
This might have a negative impact on Seplat share, and spur sell off among shareholders, with a major Non-Executive Director, Kazeem Raimi, reported to have sold N25.3 million worth of shares – so investors need to trade with caution as the capital market resumes.
Flour Mills of Nigeria
Flour Mills of Nigeria has disclosed its interest to increase its stake from the 76.75% it currently holds in Honeywell Flour through Ecowise Horizon Investment Limited and Creywise Investment Solution Limited.
According to Honeywell, Flour Mills has triggered a mandatory takeover offer to acquire 79.30 million shares, at the cost of N333.06 million, as it intends to pay N4.20kobo per share to shareholders.
This is 48.4% above current market price, which is N2.83kobo per share, so the buyout offer is a significant gain for shareholders who qualify for the trade, and could positively influence Honeywell share in the long term, however, investors still need to trade with caution.
Ardova share depreciated by -3.84% on Friday, to close last week with N12.5kobo, below its opening of N13 per share, as shareholders engaged in sell off amid lawsuit against its majority shareholder, Prudent Energy.
Ripples Nigeria had reported that Zenon Petroleum, a former investor in Ardova (when it was still Forte Oil), had filed a windup lawsuit against Prudent, after the latter failed to pay the balance of the acquisition fee of $200 million.
Zenon, owned by Femi Otedola, had sold its 74.02% stake in Ardova to Prudent Energy in 2019, with a balance of $6 million due for June 18, but Prudent, owned by Abdulwasiu Sowami, hasn’t balanced up.
So Zenon is seeking to windup Prudent to takeover its share in Ardova in place of the $6 million Sowami is owing Otedola’s company. With the case yet to be publicly settled, its unsure how long the confrontation’s impact on Ardova’s share will last – so trading cautiously this week is advised, as Ardova will open the stock market at the losers table.
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