Oando Plans to Raise N500bn Capital Through Public Offering, Rights Issues and Debt Restructuring
Oando PLC has announced its intention to increase up to 500 billion Nairas in new capital as part of a financial and strategic growth financial plan aimed at strengthening its balance sheet and extending its operations.
The Nigerian energy company revealed it in a notice filed with Nigerian Exchange Limited (NGX) on Monday, July 21, before its 46th annual general meeting scheduled for August 11.
Signed by Ayotola Jagun, the secretary of the company, the opinion revealed that Oando intended to issue up to 10 billion of new ordinary actions of 50 kobo each. These will be floated through public offers, private investments, rights of rights or debt conversions in capital – according to the route that the company’s board of directors chooses in accordance with market conditions and the feeling of investors.
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According to the document, the revival of capital can be carried out in the local and international markets. The company said it would be authorized to “increase additional capital of up to 500 billion Nairas or its equivalent in foreign currencies … at prices determined through construction or any other acceptable evaluation method”. The process is subject to regulatory approvals.
As part of the wider financing strategy, the Oando board of directors also requests the approval of shareholders to convert $ 300 million in its loan -based loan debt (RBL) to equity. The company aims at the main stakeholders and lenders as part of this planned conversion, more emphasis on efforts to facilitate its debt charge and improve liquidity.
In a related decision, Oando plans to establish a multi-instrument emission program of a value of up to 1.5 billion dollars, which allows it to issue obligations, certificates or other financial instruments. The objective is to diversify sources of financing and provide flexibility in the execution of future capital increases.
The company added that it could absorb the excess funds of any overflowing resulting from the issue, provided that it complies with regulatory limits and approvals.
Financial situation and stock performance
Oando’s restructuring arrives at a pivotal time for the company. On Monday, its share price exchanged 50.00 n, marking a Naira of 0.50 or a drop of 0.99% compared to the previous negotiation session. During the last month, the action lost 20.89% in value, reflecting the prudence of the market in the midst of broader volatility.
However, long -term perspectives remain robust – action increased by 184.09% in the past year, according to trading Economics.
Forecasts suggest that Oando can face short -term opposite winds. Analysts predict that the course of action will lie down at N49.94 by the end of the current quarter and to pass slightly to N48.31 within one year. However, analysts believe that recent restructuring and acquisitions could improve business fundamentals in the future.
Recent recent acquisition and segment
The increase in capital follows Oando’s historic acquisition of 100% participation in Nigerian Agip Oil Company (NAOC) of the Italian energy giant in August 2024. The agreement gives Oando a total control of key assets and should considerably increase its production capacity and reserves.
Oando PLC works as a supplier of energy solutions entirely integrated into Nigeria and the West African region. Its operations are divided into four major segments: exploration and production (E&P), supply and trade, gas and energy, and business and others. The E&P arm manages upstream operations – including the exploration and production of oil – through rights acquired in blocks located both on land and Nigeria offshore.
The company says that capital injection will allow it to optimize existing operations and generate new investments through its supply chain – in particular in upstream assets, intermediate infrastructure and commercial capacities.
Oando is positioned for more aggressive growth despite the uncertainties of the global oil markets of interior economic opposites by converting part of its equity debt and by establishing a large-scale multi-instrument program. If it is successfully executed, this decision should place the company among the most financial indigenous energy players in sub -Saharan Africa.
The company stressed that its board of directors will be empowered to “conclude agreements and / or to carry out documents, to appoint these professional parties, to carry out all these other acts and to do all other things” to facilitate the increase in capital, subject to regulatory authorization.
