Femi Otedola sells all his Acquired Transcorp Shares to Tony Elumelu. This is coming after he bought the shares and wanted to do a hostile take over of Transcorp. Mr. Elumelu was able to buy all the shares Otedola bought, and he is in full control of the company.
Femi Otedola sells all his Acquired Transcorp Shares to Tony Elumelu
Femi Otedola has sold his Transcorp shares to Tony Elumelu after mutual friends intervened.
The battle for the ownership of Nigeria’s biggest conglomerate between two of Nigeria’s finest business tycoons, Tony Elumelu and Femi Otedola, has finally come to an end as Femi Otedola has sold his Transcorp shares with a premium to Tony after mutual friends led by Aliko Dangote intervened in the battle, putting an end to an intriguing corporate drama that has shocked, rocked, and rolled Nigeria’s capital markets over the past several days.
According to a media outlet, Billionaire Africa, a privileged source who enjoys proximity to the two billionaires and who requested anonymity, claims that as a way of settlement, Tony Elumelu paid Femi Otedola a 400-percent premium on Transcorp’s closing price on Thursday night to acquire his bloc of shares.
This would mean that Otedola, who owned 2.6 billion shares, or 6.3 percent of the company, was paid somewhere in the neighborhood of 12.5 naira per share and walked away with 32.5 billion naira cash out.
The Battle for the Soul of Transcorp
Despite the fact that the two men share close relationships and call each other brothers, Tony was not aware of the move by Femi Otedola to invest in his company as he woke up to the news, just like many of us were.
Sources close to Otedola confirmed that the chairman of Geregu Power was keen on wrestling control of Transcorp from Elumelu and was eyeing its lucrative power assets.
While Otedola’s publicly traded Geregu Power has one power plant in Kogi State with an installed capacity of 435 MW and boasts a market cap of more than $1.6 billion, Transcorp has two power plants in Delta and Rivers states with a combined capacity of over 2,000 MW, but its market cap sits at less than $300 million.
Analysts had long maintained that Transcorp was significantly undervalued.
Otedola purchased the underperforming state-owned power asset in 2013, with an effective capacity of less than 100 megawatts (MW), and increased its capacity to 435 MW, with 70–80 percent of the power generated being supplied into the grid.
Geregu Power, whose shares have doubled in just six months, recently paid out N20 billion in dividends to its shareholders for the 2022 fiscal year.
Transcorp’s stock, on the other hand, had perpetually languished in the neighborhood of 1 naira per share for years, with lackluster dividends paid over the past few years.
Otedola had already started making demands for board seats on Transcorp’s board and was still buying shares in the company every day.
Tony Elumelu wanted to remain as the chief shareholder in the organization. Within a space of days, Elumelu acquired an additional 9.7 billion shares in separate deals to ramp up his combined stake in the group to 10.5 billion shares, or 25.9 percent, cementing his position as Transcorp’s main shareholder.
Femi Otedola made billions of naira, in gain, from this deal.
Finally, Femi Otedola still goes ahead to sell his shares to Tony Elumelu. Now, at the moment, Mr. Elumelu is the biggest and highest shareholder in the corporation by a long mile. This sums up this post with the topic of Femi Otedola sells all his acquired Transcorp shares to Tony Elumelu.
Source: Chukwudi Iwuchukwu, a Business man and Expert on Facebook