On Tuesday, February 21, 2022, an off-market trade of 125.01 million Geregu Power Plc shares worth N12.5 billion was completed.
According to Nairametrics’ off-trade report, the transaction was negotiated between PAC Securities Limited (buyer) and APT Securities and Funds Limited (seller).
According to Nairametrics, the transaction involves Afrexim Bank subsidiary FEDA purchasing 125 million shares of Geregu Power.
FEDA
The Fund for Export Development in Africa (FEDA), the African Export-Import Bank’s (Afreximbank) development impact investment platform, recently announced that it has received internal approvals to acquire a minority stake in Geregu Power Plc, subject to satisfactory diligence and documentation.
FEDA is obligated to provide capital to advance intra-African trade, export development, and African industrialization.
It also stated in a statement that as part of its intervention efforts in Africa’s energy sector, it has made a strategic decision to support leading energy platforms across Africa, including the renewables and transition fuels sectors.
FEDA stated that it intends to support the company as a minority investor and to collaborate with the current owners and management team to drive the company’s growth over the next few years.
What this means
The FEDA acquisition of Afrexim Bank shares is the first major foreign investment of a publicly quoted company in Nigeria in 2023.
- Geregu and Afrexim announced in December that they had finalized an agreement for the strategic purchase of 5% of Geregu shares by Afrexim on the NGX.
- Geregu Power shares have rallied by over 100% since it was listed last October and is currently trading at about N224 per share.
Geregu Share Price
Critics have pointed to the company’s high price-to-earnings ratio of 50x or higher as evidence that the stock is overvalued.
As a result of multiple system failures and gas supply issues, the company reported earnings per share of N4.47 per share, a 50% decrease from the previous year.
The term “crowdsourcing” refers to the practice of crowdsourcing information.
Off-Market Trades
Trades that are not settled through the Clearing Corporation/ Clearing House of exchange are classified as ‘’Off Market Trades”. Delivery of securities to or from sub-brokers, and delivery for trade-for-trade transactions, by this definition, are off-market trades.
- Geregu closed its last trading day (Tuesday, February 21, 2023) at N224.00 per share on the Nigerian Stock Exchange (NGX).
- Geregu Power began the year with a share price of N149.00 and has since gained 50.3% on that price valuation, ranking it seventh on the NGX in year-to-date performance.
