Nigeria’s big businesses are sealing deals, and frontline startups are snapping up millions in big-time funding rounds. It’s the story of half a year in an economy’s life.
Despite concerns that the country’s commerce and industry stands on wobbly foundations, investments continue to happen. Analysts say we should be cautious about the numbers; after all, some of the said business deals may be more rescue mission than anything else. Still, there’s some ground for optimism and hope that enterprise could help Nigeria out of its difficulties.
Here’s a roundup of the biggest business deals that made the headlines in the first six months of 2019.
1. Access-Diamond Bank Merger
This kicked off late in 2018, after months of speculation around a possible takeover of Diamond Bank by Access Bank. The deal saw Diamond Bank’s assets subsumed into the existing Access Bank network, and the latter institution tweaking its logo to reflect something of its merger partner’s ethos.
The deal is reported to have been worth about $200 million.
2. Airtel Africa and Qatar Investment Authority
Late in January, news broke that Airtel Africa was raising $200 million from Qatar Investment Authority. The funding was said to be needed to reduce the debts of the telecoms company’s London-based holding company. The equity investment has cut the portion of shares held by the company in Africa. Nigeria is Airtel’s largest market on the African continent.
3. Andela’s Series D Funding Round
Also in January, tech outsourcing startup Andela announced that it had raised $100 million in its series D funding round. It’s the largest ever amount raised by an African tech startup. The investors included Al-Gore’s Generation Investment Management, the Chan Zuckerberg Initiative, Google Ventures, GRE Ventures, and Spark Capital.
4. Lafarge Africa’s Rights Issue
In March, Lafarge Africa, building materials giant, said that it had succeeded in raising new capital through its rights issue. The sum realized was reported to be about ₦89.9 billion. The company says the fresh capital will be channeled towards strengthening its operations in Nigeria.
5. Mastercard’s Investment in Jumia
Earlier this year, global credit card giant Mastercard pledged to stake $56 million on Jumia, Africa’s first ecommerce unicorn. This was made known in the run-up to Jumia’s listing on the New York Stock Exchange (NYSE) in April.
6. Oando’s Sale of Its Stake in Axxela
Also this year, oil and gas company Oando divested its 25% stake in Axxela, a gas and power portfolio company. The stake was sold to Helios Towers, a telecoms tower infrastructure firm, for about $41 million. Oando’s hierarchy explained that the sale was informed by the company’s need to reduce its debt profile.
7. Olam’s Purchase of Dangote Flour Mill
In an announcement that surprised many, Olam, an agro-industry company, said in April that it was set to acquire Dangote Flour Mill for about $361 million. Olam seems to have its sights on DFM’s lucrative flour and pasta products and is eager to make those segments even more profitable. More recently, a revised bidding offer has been submitted by Olam for the buy over of Dangote’s flour mill business.
8. MTN Nigeria’s listing on the NSE
Telecoms giant MTN listed its shares on the Nigerian Stock Exchange in May, sparking excitement within and outside of stock trading circles. The initial listing of 20 billion ordinary shares at ₦90 per share meant that MTN kicked off on the bourse with a market capitalization of ₦1.8 trillion. Currently, it’s the second-largest company on the NSE, just behind Dangote Cement.
Featured image source: We The Italians
Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.