Seplat Energy Plc, one of Nigeria’s leading indigenous oil and gas companies, has announced a significant update to its shareholder structure following the acquisition of shares by the Chairman of its Board, Udo Udoma.
The company, in a disclosure on September 27, 2024, revealed that Tierce Investments Ltd, a company wholly owned by Udoma, had acquired 22,571 ordinary shares in Seplat Energy.
This acquisition represents Udo Udoma’s first stake in Seplat, as he previously held no shares in the company.
Udo Udoma’s entry into Seplat’s shareholder base
The 22,571 shares acquired by Udoma represent a 0.004% voting interest, based on the company’s total issued shares of 588,444,561.
- The transaction may signify Udoma’s confidence in the company’s future, aligning his interests with those of Seplat’s shareholders.
- The purchase was executed at a time when Seplat’s share price stood at N4,103 on the Nigerian Exchange Group (NGX) as of September 27, 2024.
- This values the acquisition at approximately N92.57 million. As the Chairman of the Board, Udoma’s decision to invest in Seplat through Tierce Investments highlights his belief in the company’s strategy and long-term potential.
Implications of Udo Udoma’s share purchase
Udo Udoma, a prominent figure in Nigerian business and politics, previously served as Nigeria’s Minister of Budget and National Planning. His entrance into Seplat’s shareholder list could be viewed as a positive signal to the market.
- As board members are often seen as having insider knowledge, Udoma’s purchase may reflect optimism about Seplat’s growth trajectory and financial outlook.
- Seplat Energy Plc has been a key player in Nigeria’s oil and gas industry and has continued to deliver value to shareholders despite global energy market challenges.
The company’s strategy to diversify into natural gas and renewable energy projects has been well received by investors, positioning Seplat for sustained growth amid the global shift towards cleaner energy sources.
Shareholding Overview
As of June 30, 2024, Seplat’s largest shareholders included:
- M&P Group, holding 120,402,000 shares (20.46% ownership),
- Petrolin Group, with 81,015,319 shares (13.77%),
- Sustainable Capital, with 54,328,805 shares (9.23%),
- Professional Support Limited, with 47,929,438 shares (8.15%),
- Allan Gray Investment Management, with 41,895,757 shares (7.12%).
While Udoma’s holding of 22,571 shares is comparatively small, his entry into Seplat’s shareholder base as the Chairman of the Board sends a strong message to investors about his commitment to the company.
It also aligns his personal financial interest with Seplat’s long-term success, a move that may bolster investor confidence.
Seplat’s performance and market impact
At N4,103 per share, Seplat Energy Plc remains one of the more highly valued stocks on the NGX, having gained a whopping 77% year to date.
Seplat’s diversified operations, including its natural gas business, have provided a buffer against the fluctuating prices in the crude oil market.
With Nigeria increasingly focusing on natural gas as a cleaner energy alternative, Seplat appears well-positioned to capitalize on this trend, further strengthening its market position.
- Seplat Energy recently declared a sum of N28 billion in interim dividends to its shareholders for the second quarter of 2024.
- A corporate disclosure on the NGX website reported by Nairametrics reveals that the company will use an exchange rate of N1,570.99 per dollar—NAFEM’s closing rate on August 12—for its Q2 2024 interim dividend payment.
- With an interim dividend of $0.03 per share, it amounts to N47.13 per share, thus totaling a dividend payout of N28 billion.
- Combined with its interim dividend payout of N26.5 billion for the first quarter of 2024, the company will distribute N54.5 billion in dividends for the first half of 2024.
- This marks a 152% year-on-year increase from the N21.6 billion dividends paid in the first half of 2023.
- In the first half of 2024, Seplat Energy posted a profit after tax of N68.6 billion. Hence, in H1 2024, the company hit a dividend payout ratio of 80%. In H1 2023, the company had a dividend payout ratio of 51.4%.
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