Geregu Power Plc has notified the Nigerian Exchange Limited and the investing public of its discussions with the Fund for Export Development in Africa (FEDA) for the acquisition of a portion of Geregu Power Plc shares.
FEDA is the impact development arm of the Africa Export and Import Bank (Afreximbank), Bloomberg reported.
“The discussions are currently on going and where these talks progress to a more advanced stage, the Company will notify the Exchange and the investing public in line with the rules of the Exchange,” Geregu Power said.
For the year ended December 2021, Geregu Power’s net income surged by 45.53 percent to N20.54 billion from N14.12 billion as at December 2020.
It earns sizable profit from business function for a given period as operating profit soared by 54.55 percent to N29.52 percent in December 2021 from N19.10 billion the previous year.
The Benedict Oramah-led bank stressed that it plans to buy shares in Geregu Power Plc, a leading power-generation company majority owned by Nigerian billionaire Femi Otedola.
“Geregu Power Plc hereby notifies the Nigerian Exchange Limited and the investing public of its discussions with the Fund for Export Development in Africa (FEDA) for the acquisition of a portion of Geregu Power Plc shares,” the company’s secretary said in a statement.
The move, announced on the Nigerian Exchange (NGX) at t.ge weekend, comes nearly two months after the Otedola-led power-generating company successfully listed its shares.
Although the specifics of the proposed transaction are currently unknown, discussions are ongoing as both parties move negotiations to a more advanced stage.
Geregu, a spin-off subsidiary of Otedola’s now-defunct Power Holding Company of Nigeria, successfully listed its shares on the Nigerian Exchange on October 5 at a price of N100 ($0.231) per share, giving it a market capitalization on the local bourse of N250 billion ($579 million).
The company’s shares have increased by 22.8 per cent since they were listed on the Nigerian Exchange, from N100 ($0.225) on October 5 to N122.8 ($0.276) on December 3 as retail investors, investment banks, and hedge funds continue to buy into the power company.
Geregu has grown into one of Nigeria’s largest power-generating enterprises under Otedola’s ownership, using gas turbines as a clean energy source to generate power.
At the end of its fiscal year in 2021, the power-generating company, Otedola, reported a profit of N20.55 billion ($47.32 million), owing to a double-digit per cent increase in revenue.
Despite disruptions in the Nigerian power sector, revenue increased from N53.67 billion to N70.97 billion ($163.4 million), according to billionaires Africa, a website that reports on Africa’s wealthiest people.