- NB seeks shareholders’ approval for acquisition
BY FESTUS OKOROMADU
The bullish trend in the Nigerian equity market persisted for the third consecutive week to close the week ended Friday November 17, 2023 on a positive note.
Investors showing interest in bellwether stocks propelled the NGX benchmark index, the NGX All-Shares Index by a 0.37 percent gain to close at 71,112.99 points.
Market analysts said the uptick occurred amidst profit-taking activities, as market players carefully digested the latest inflation data, which surged to 27.33 percent in October from the previous month’s 26.72 percent.
They stressed that the market’s focus is now shifting towards release of the Q3 GDP figures and the outcomes of the upcoming Monetary Policy Committee meeting of the Central Bank of Nigeria, both of which are expected to provide crucial insights into fund flow dynamics and the potential market trajectory.
Vetiva research analysts said they still expect similar tepid trading sessions in the new week, “as investors look to other asset classes, given significant returns most of the counters have posted this year.”
Meanwhile, there are indications that the inflationary pressures, as reflected in the recent data, have added an extra layer of complexity to market dynamics.
Investors are keenly observing how these factors, coupled with the year-end seasonality, will influence market sentiment.
The third quarter brought impressive corporate earnings, complemented by rising yields in the fixed income market.
This dual scenario presents a mixed bag of opportunities and challenges for equity investors.
In terms of market capitalization, listed equities recorded a 0.37 percent week-on-week increase, translating to N182.86 billion gain as it hits N39.11 trillion, hence, the year-to-date return, extended further to 38.75 percent.
Despite a relatively positive overall performance, the Banking and Industrial indexes faced minor setbacks, declining by 0.04 percent and 1.18 percent, respectively. This dip was attributed to adverse price movements in specific stocks such as FIDELITYBNK, ACCESS, BUACEMENT, and BETAGLASS.
Conversely, the Oil & Gas sector emerged as the week’s leading gainer, experiencing a 2.61 percent week-on-week increase.
The uptrend was fuelled by gains in SEPLAT and OANDO.
Additionally, the Insurance and Consumer Goods sectors posted gains of 0.91 percent and 0.2 percent, respectively, driven by significant increases in PRESTIGE, CHIPLC, NASCON, GLAXOSMITH, and OKOMUOIL.
Trading activity during the week witnessed a lackluster performance, with a 19.80 percent decline in total traded volume, amounting to 2.03 billion units.
The weekly traded value also decreased by 38.86%, totaling N27.69 billion. Noteworthy performers included DEADCAP, CILEASING, and MECURE, each securing impressive gains of 55 percent, 50 percent, and 46 percent, respectively, on a week-on-week basis.
In contrast, certain stocks, such as JAPAULGOLD, BETA GLASS, and TIP, faced declines in their share prices, experiencing losses ranging from -14 percent, -10 percent, and -10 percent, respectively, on a week-on-week basis.
NB seeks shareholders’ approval for acquisition
Meanwhile, the Nigerian Breweries said it is set to seek the approval of its shareholders regarding the acquisition of a 60 per cent stake in Distell Wines and Spirits Nigeria Limited as well as a takeover of the import business of Heineken Beverages (Holding) Limited in Nigeria.
According to a notice filed with the Nigerian Exchange Limited, the meeting is scheduled to be held next month in Lagos.
Part of the notice read, “Following the conclusion of a detailed review of the Offer, the Board met at a special meeting on the 16th of November 2023 and resolved as follows: a) To recommend to Shareholders in a general meeting for their consideration and approval, the acquisition of 80 per cent economic interest, voting, and other rights held by Heineken Beverages (Holdings) Limited in Distell Wines & Spirits Nigeria Limited, which interests and rights are held through Distell International Holdings Limited, and 100 per cent of the import business of Heineken Beverages (Holdings) Limited in Nigeria (including the license to market, distribute and sell the imported products, as well as produce any of the imported brands locally).”
In May, the Board of Nigerian Breweries Plc said it received an offer to acquire the majority stake in Distell Wines from Heineken Beverages (Holdings) Limited.
Distell Nigeria is involved in the local production of wines and ciders; as well as the importation of wines, spirits and flavoured alcoholic beverages.
The proposed acquisition is subject to the regulatory approval process.
The company said that the acquisitions “aligns with its strategic objective of expanding its current product offerings beyond beer to include wines, spirits, and flavoured alcoholic beverages. It also provides the Company with growth opportunities and long-term profitability.”
Heineken Beverages owns 100 per cent of Distell International Limited, whose subsidiary is Distell Nigeria.
Distell Nigeria was founded in 2018 and has its headquarters in Lagos.
