Nigerian Breweries Plc has stated that it intends to use the money raised from its N599.1 billion rights issue to pay off past-due foreign exchange obligations. This will put the company in a better position to perform at its best and provide value to its stakeholders. The corporation is giving its shareholders access to 22.61 billion ordinary shares, valued at N26.50 per share, at a cost of N50,000 apiece. Beginning on September 2, 2024, and ending on Friday, October 11, 2024, is the Rights Issue.
All current shareholders may participate in the offer, which gives them the chance to enhance their ownership stake in the company at a ratio of 11 additional shares for every five they already own as of July 12, 2024, the close of business.
The Managing Director of Nigerian Breweries Plc, Hans Essaadi, explained during the "Facts Behind the N599.1 Billion Rights Issue" presentation at the Nigerian Exchange Limited, NGX, on Tuesday that the losses shown in the company's financial statements were primarily caused by the effect of the currency devaluation on foreign exchange denominated payables and higher interest expenses. "These are challenging times for our company. Two years ago, we began building more space, requiring foreign exchange commitments in order to future-proof the company. As a result, the naira's depreciation caused us to accrue a significant debt. We think that investing in Nigeria is the proper course of action since the long-term fundamentals are still solid, notwithstanding this obstacle among others," he stated.
Essaadi gave shareholders confidence that the company will soon resume paying dividends and return to a profitable operational position through the Rights Issue. The company is also well-positioned to benefit from an improvement in the macroeconomic climate. Khan continued by saying that the company's goal to increase sustainable value for its shareholders was furthered by its entry into the wine and spirits market with the acquisition of Distell Wines and Spirits Nigeria Limited.
Jude Chiemeka, the Chief Executive Officer of NGX, also spoke at the presentation and mentioned that "Facts Behind the Figures/Issue" is still a platform to support the company's goal of increasing transparency and encouraging participation in the capital markets. The NGX, he continued, was thrilled that Nigerian Breweries Plc had selected the venue to showcase its operational updates, financial results, and strategic business recovery strategy, which included the N588.1 billion rights issue. Chiemeka contends that in order to increase market activity, timely and accurate data sharing is crucial since it builds participation and trust.
In spite of economic challenges, he acknowledged the leadership of the company's efforts to improve operations, support business continuity, and win back investor confidence. He said that the company's dedication to these objectives demonstrates the adaptability and resilience that are critical in the current market climate. The legal director and company secretary of Nigerian Breweries Plc, Uaboi Agbebaku, said in his remarks that the business will use the proceeds of the rights issue to pay off all outstanding foreign exchange payables, removing the company from the whims of devaluation."The company will bear less interest as a result of using a significant portion of the proceeds to settle past-due foreign exchange obligations and repay and reduce local debt (naira) obligations," he stated.
IN THE PICTURE ATTACHED
from left to right, are Jude Chiemeka, the Chief Executive Officer of NGX; Hans Essaadi, the Managing Director of Nigerian Breweries Plc; Uaboi Agbebaku, the Company Secretary/Legal Director of NB Plc; Chuka Eseka, the Group Chief Executive Officer of Vetiva Advisory Services Limited; Oladele Shotubo, the Chief Executive Officer of Stanbic IBTC Capital; and Ben Wessels Boer, the Finance Director of NB Plc. This event took place on the Nigerian Stock Exchange floor in Lagos
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