Ardova Plc has informed the Nigerian Exchange (NGX) of its intention to delist as a publicly listed company.
This is on the backdrop of Ignite Investments & Commodities Limited proposed N17.38 per share buyback.
Company Secretary, Ardova Plc, Mr. Oladeinde Nelson-Cole in a statement said it had been approached by its parent company, Ignite Investments & Commodities Limited to acquire the shares held by other shareholders of the company at an offer price of N17.38 per share.
Ignite Investments & Commodities Limited currently owns 74 per cent of Ardova and is the majority shareholder of the company.
Nelson-Cole said the company arrived at the share price of N17.38 per share using the 30-60 day volume weighted average share price of N14.19 and N13.97 respectively, on November 30, 2022
“The offer price of N17.38 represents a premium of 22.44per cent and 24.38per cent to the 30-day and 60-day volume weighted average share price of N14.19 and N13.97 respectively, on November 30, 2022 (being the last trading day prior to the Offer).
“It is intended that the Proposed Transaction will be implemented under a Scheme of Arrangement in line with section 715 of the Companies and Allied Matters Act, No.3 of 2020 (as amended) and other applicable rules and regulations.
“The Proposed Transaction is subject to the review and clearance of the Securities and Exchange Commission as well as the approval of the shareholders of the Company.
“The terms and conditions of the Proposed Transaction will be provided in the Scheme Document which will be dispatched to all shareholders following the receipt of an order from the Federal High Court to convene a Court Ordered Meeting. If the conditions of the Proposed Transaction are satisfied and same is sanctioned by the Federal High Court, the Company would be delisted from NGX.
“Further developments will be communicated to shareholders in due course. Ardova Shareholders and members of the public are advised to exercise caution in dealing in Ardova’s shares until further information is provided,” the statement added.
The company has a total external debt of about N55 billion which includes 2 tranches of unsecured corporate bonds totaling around N25.2 billion.
Holders of the bond will have to approve any mergers or consolidations of the company as reported in its financial statements.
Ardova currently has a free float of 339,962,574 shares and at the offer price of N17.38 per share, it will cost Ignite Investments & Commodities about N5.9 billion to buy out other shareholders. The company has a market capitalization of N22.9 billion as of the date this offer was made.
Ardova used to be Forte Oil and was acquired in 2019 after billionaire investor Femi Otedola sold the downstream arm of the company.
Ardova in its unaudited result and accounts for the year 2022 revealed a loss after tax of N7.6 billion from N3.85billion reported in the audited financial statement for period ended December 31, 2021.
From the profit & loss figures, the group announced N7.14billion loss before tax in 2022 from N2.9billion loss before tax in 2021, attributable to increased cost of sales, total operating expenses, and finance costs.
The company swung into losses as a group after its acquisition of Enyo Retail and Supply in late 2021.
Soon after this acquisition it lent Enyo N12.3billion in an 8-year loan at an interest rate of 14per cent.
Important to note that Ardova acquired Enyo through a subsidiary Bags and Kegs and as such the acquisition cost was not captured in the books of Ardova.
Ardova currently trades at a share price of N16.8 per share with 1,302,481,103.00 outstanding shares as at February 6, 2023.
