Transcorp shares crash to 79 kobo

No Comments » January 1st, 2009 posted by // Categories: Nigeriawatch



Transcorp shares crash to 79 kobo


Written by Yunus Abdulhamid   

Thursday, 01 January 2009


From N7.21K per unit of share in 2006, yes-terday the share value of Transnational Corporation of Nigeria Plc crashed to 79 kobo, even as the general value of shares has started recovering after the stock market lost N6 trillion  from a March record of N12.6 trillion.

Trading on the floor of the Nigerian Stock Exchange (NSE) closed yesterday with the price of Transcorp’s share plunging further down in the deep waters of the crisis currently rocking the Nigeria’s capital market.

Although, there have been some gradual improvements in the past few days which investors are hoping will continue.

Yesterday, 7.978685 shares valued at 6,233,222,537 in 66 deals were traded on the Transcorp platform.

Transcorp had gone to the capital market in 2006 to raise funds with much fanfare in the wake of its acquisition of the former NICON Hilton Hotels, now Transcorp Hilton in Abuja and the Nigeria Telecommunications limited (NITEL).

At the time, investors bought a unit of the shares for N7:21k. It had acquired 51% stake in company at the cost of $500 million.

With the active participation of the NSE boss, Professor Ndi Okereke Onyuike, and support of the then President Olusegun Obasanjo, investors bought the shares in droves. But the fortune of the company has dwindled while running into trouble waters with the federal government for its inability to fix the ailing foremost national telecommunication carrier, NITEL. 

As at the close of trading at the NSE on Tuesday, the price had slide to N0:81k but went further down by yesterday to N0:79k, making it one of the nine companies quoted in the Nigeria capital market that have gone below N1 per share.

When Daily Trust contacted the Transcorp spokesperson, Mr.  Adedayo Ojo to comment on the development, he said: “We are concerned but it’s not just Transcorp. It’s a general problem. Once we get things settled, we would get real value for our share holders.”

Latest media reports has it that the management of Transcorp have reached  a conditional agreement with the federal government to cede its equity to the government which would be handed to a new core investor that is to emerge from soon, following the time table of the Bureau of Public enterprises (BPE).

The agreement was reached at a meeting, held at the instance of Vice-President Goodluck Jonathan, who chairs the National Council on Privatisation (NCP). Transcorp is said to have agreed to give BPE the power of attorney for the sale of 27 per cent stake in NITEL.

The corporation also agreed to release the entire equity on favourable valuation.

Favourable valuation for Transcorp means that the value of NITEL, to be determined by BNP Paribas, the consultants that recently won the bid to provide advisory services for the resale of NITEL, will be high enough to cover the $500m it had paid in 2006 for the equity; the interest payable on the loan syndicated by some Nigerian banks and the money the company borrowed to sustain the operations of NITEL and its mobile subsidiary, the Nigerian Mobile Telecommunications Limited.

Opt In Image
Send Me Free Email Updates

(enter your email address below)

Leave a Reply


free porn szex filmek pornos xnxx
Home | About | Contact | Login