Femi Otedola has acquired 5.52% of Transcorp shares and that makes him the second top owner

Billionaire investor Femi Otedola is known for making spontaneous acquisitions on the Nigeria stock exchange. Today, it was revealed that the former owner of Forte Oil has acquired 5.52% of Transcorp shares, making him the second-largest shareholder of the Nigerian conglomerate. The deal involved a trade of approximately 1.5 billion units of Transcorp shares, valued at about N2.1 billion, which crossed at the close of trading on April 11. Another 115 million units of the stock crossed on the exchange closing at N1.4 per share. The transaction was reportedly consummated between an entity owned by Otedola and an unnamed seller, although another source confirmed the transaction was related to AMCON.

Otedola saw value in Transcopt company shares, the stock has been trading around N1 per share for a long time and he could easily help the company to embark on a good turnaround. This may be good news for investors. 

With the acquisition of 5.5% of Transcorp, sources suggest that Otedola is likely to set the stage for another bidding war for control of one of Nigeria’s indigenous and most recognized conglomerates. Transcorp is currently controlled by billionaire investor Tony Elumelu, who took over control of the company in 2012. Since then, the company has gone on to acquire a power generation company and branched into the oil and gas sectors of the economy.  This transaction may mean that Otedola gets a board seat or eventually, he could buy more Transcorp shares to get majority control of the company.

According to reliable sources, the billionaire now owns about 2.245 billion shares, representing 5.52% of the company. As of December 2022, the only other shareholder with over 5% ownership of the company is UBA Nominees, which owns about 9.25% of the company. No other shareholder held above 5%, and the company also has about 39.65 billion out of its 40.65 billion outstanding shares on a free float.

It is unclear if the latest acquisition is aimed at doubling down his investment in the power sector, as Otedola also owns a close to 90% stake in Geregu Power Plc, which it recently listed on the exchange last year. Investingport could not immediately obtain comments from Transcorp or from Femi Otedola’s team, and the acquisition could be made official within 24 hours.

Transcorp released its financial results for the full year ended December 31, 2022, showing the Group’s total revenue rose by 21% from N111.2 billion in December 2021 to N134.7 billion in the period under review. Its operating profit also experienced significant growth, rising from N38.5 billion in December 2021 to N46.7 billion in December 2022. Its profit before tax rose by 8% to N30.3 billion compared to N27.9 billion in December 2021, however, profit after tax fell from about N23.8 billion to N16.8 billion.