Daily Watch – Lafarge Africa lists additional 7.43bn Shares on NSE, Nigeria to borrow at home, abroad to fund 2019 budget

The National Broadcasting Commission (NBC) has signed an MOU with a private firm, Corrido Communications, for the use of TV White Space, unused broadcasting frequencies in the wireless spectrum, to connect rural communities to broadband communications services. According to the Executive Vice Chairman of the Nigerian Communications Commission, Umar Danbatta, both commissions had received marching orders from the National Frequency Management Council to work together for the realisation of the use of TV White Space in rural broadband connectivity. Director General of the NBC, Mallam Ishaq Kawu, disclosed that Corrido Communications had satisfactorily demonstrated proof of the concept before the MoU was signed. Danbatta who was represented by the Director of Spectrum Administration, Austin Nwalune at the stakeholders’ forum on rural connectivity using TV White Space in Abuja on Tuesday, said cheaper connectivity was required in rural communities because of the challenge of capacity to pay for commercial services in the communities.

Nigeria’s minister of finance, Zainab Ahmed, has said that the country plans to get loans locally and internationally, particularly concessionary long-term loans to finance its 2019 budget. Ahmed’s statement was disclosed by the National Assembly via its official Twitter account. She said there were challenges generating revenue but that the 2018 budget has performed well. She also said that the government had put in place strategies on how to finance the 2019 budget of ₦8.83 trillion ($28.9 billion). Budgets under President Muhammadu Buhari, who starts a second term in May, have been the country’s largest ever in naira terms, but have failed to provide the type of capital spending needed to improve infrastructure due to funding issues. The government has been seeking to boost revenue after it emerged from a 2016 recession two years ago. Nigeria has borrowed abroad and at home over the past three years to help to finance its budgets and to fund infrastructure projects but debt servicing cost is also rising.

The value of the logistics sub-sector of Nigeria’s economy currently stands at ₦250 billion, according to the 2018 Logistics and Supply Chain Industry report. The sub-sector as of 2017 was valued at ₦200 billion in terms of the value of goods and services as well as the value of the decayed infrastructures, according to the report presented by the Director General of the African Centre for Supply Chain, Obiora Madu. The logistics and supply chain businesses, which is seen as the fastest growing industry in the world is still faced with intense pressure in Africa, particularly Nigeria, as it deals with deficits in logistics infrastructure and capacity challenges, Madu said. The report quoted a survey carried out by the Lagos Chamber of Commerce and Industry, LCCI, members of the Organised Private Sector and the Centre for International Private Enterprises in 2018, which showed that the Nigerian economy lost an estimated annual revenue of ₦3.46 trillion to poor infrastructure, poor implementation and corruption at the ports, of which ₦2.5 trillion are corporate earnings losses across the various sectors of the economy. An instance by the report is the “Honeywell Flour Mills Plc, a major flour milling company in Nigeria, which attributed the dip in their profitability in 2017 to the Apapa traffic gridlock saying that the dilapidated road infrastructure and chaotic traffic situation in and around the nation’s seaports made it inordinately difficult, and enormously expensive to transport goods out of the factory in Tin-Can Island.

Lafarge Africa has formally completed its ₦89.2 billion rights issue, which recorded 100 percent subscription, with the listing of additional 7.43 billion ordinary shares of 50 kobo each that arose from the new issue at the Nigerian Stock Exchange (NSE). The new 7.43 billion ordinary shares of 50 kobo each were sold to existing shareholders of the cement company at ₦12 per unit from Monday, 17 December, 2018 to Monday, 28 January, 2018. The company issued 6 new shares for every 7 shares held by shareholders as at December 4, 2018, which was the qualification date. With this listing of the additional 7.43 billion ordinary shares on the NSE, the total issued and fully paid up shares of the company are now 16.11 billion ordinary shares. Earlier this month, Lafarge Africa unveiled details of subscriptions of the rights issue, saying 1,826 Acceptance Forms for 7,434,367,256 units of the rights issue received were found to be valid under the terms of the exercise and were processed accordingly.