Transnational Corporation, which is a diversified Nigerian conglomerate with strategic investments and core interests in the hospitality, agribusiness, and energy sectors, recently added a new member to its board of directors. Indeed, Nigerian oil tycoon and billionaire business magnate, Femi Otedola acquired a 5.52% stake in the conglomerate. The entry of Mr. Otedola into Transcorp has paved the way for the return of the bulls helping the stock gain 75%.
Femi Otedola is the founder of Zenon Petroleum and Gas Ltd., and owner of a number of other businesses across shipping, real estate, and finance. He has recently invested in power generation as part of the liberalization of the sector in Nigeria. While acquiring a stake in Transcorp, Femi Otedola has said that he is looking forward to working with the board and management of Transcorp to realize the amazing future potential of the corporation. This acquisition makes the billionaire the second-largest shareholder of the company. In a corporate notice filed last week with the Nigerian Exchange Limited, Transcorp had disclosed that Otedola bought 2,245,639,251 units of the shares of the group, which amounted to a 5.52% stake. The first largest shareholder remains UB A Nominees holding a 9.26% stake in the company.
This latest move by Otedola has sparked interest in the Nigerian power sector, with industry analysts predicting a significant boom in the coming years. The power sector has recently been overhauled, with the government making big efforts to boost power generation and distribution in the country. As a result companies in the sector, are expected to become more profitable, with investors like Otedola positioning themselves to benefit from the surge in new infrastructure and solutions.
Sources close to Mr. Otedola emphasize that he sees value in Transcorp and is favorably disposed to combining forces to expedite its growth. Since the acquisition has been reported by Nairametrics, the shares of the company have gone from N1.4 to N2.45 per share gaining a whopping 75% return in just under a week. The stock continues to dominate in volumes and price increases as investors envisage a jostle between two of Nigeria’s most influential businessmen. This acquisition is meaningful for the Nigerian conglomerate because it has been struggling since last year. Indeed, net profits declined from N28.3 billion to N16.8 billion. Having Mr. Otedola on board will undeniably reshape the conglomerate’s organization and take it in a new direction in which efficiency and productivity would drive up profits. Mr. Otedola is convinced that his contribution to the company will bring a position outcome to the company’s growth and several sectors of the Nigerian economy.
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