Oando needs the money to conclude a purchase.
The Securities and Exchange Commission (SEC) has approved Oando’s N30.7 billion special placement fund raising exercise for the acquisition of ConocoPhillips’ Nigerian assets.
This was contained in a statement issued by Oando in Lagos and obtained by the News Agency of Nigeria.
The statement said that the company had received SEC’s approval to raise the full amount through the issuance of 2.5 billion ordinary shares of 50k each at N15 per share.
It said that N19.3 billion of the funds raised would be used to service outstanding balance of Oando’s ongoing $1.6 billion acquisition of ConocoPhillips’ Nigerian assets.
Oando said that the completion date for the acquisition had been scheduled for January 31, 2014.
The shares were fully subscribed to and bring Oando one step closer to completing the acquisition.
Commenting on the placement exercise, Wale Tinubu, Oando Group Chief Executive, described the exercise as another milestone in the achievement of its overall strategic re-focus.
Mr. Tinubu said that significant portion of the proceeds would be used to finance the closure of its upstream asset acquisition process. He said that the transaction would transform the country into a major indigenous producer of oil in Nigeria.
He promised that shareholders would reap enhanced dividend in 2014 from its carefully planned and executed strategic acquisition.
“The capital raise effort is a firm indicator of Oando’s short term corporate and operational strategy to vastly increase its equity portfolio through a three-pronged approach,” Mr. Tinubu said.
He said that the three-pronged approach would reduce debt, improve diversification in upstream and focus on higher margins.
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