Dunlop Raises Share Capital
April 11th, 2007 Ogbuotobo Chuks || chuks@stockmarketnigeria.com
By Ogbuotobo Chuks
In an effort to position itself better,shareholders of Dunlop Nigeria Plc have approved an increase in the company’s authorized share capital from N1.5 billion to N2.7 billion. This they intend doing by creating 2.4 billion additional ordinary shares of 50kobo each.
The company’s directors were authorised for the purpose of Section 124 of the Companies and Allied Matters Act Cap C20 LFN 2004, to exercise all powers of the company to issue and allot shares to subscribers of the 2006/2007 public offer in any acceptable manner it deems fit.
They were also authorized to obtain the consent of the Securities and Exchange Commission (Sec) and other regulatory bodies as required by the law, to allot additional shares in any number over the number of shares offered for subscription by the company in the offer, subject to the authorized share capital of the company.
It would be recalled that the company went to the capital market November last year to raise the sum of N5.5 billion to repay the loan it took for the ultra-modern All Steel Radial Truck Tyre Plant (ASRT) which became operational two years ago. Dunlop offered 1. 54 billion ordinary shares of 50 kobo each by way of public offer at N2.50 per share and 756 million ordinary shares of 50 kobo each to existing shareholders at N2.30 per share.
According to the chairman of the company, the hybrid offer was oversubscribed by 90 per cent while the rights issue was over subscribed by 49 per cent hence the need for the meeting.
Upon resumption of trading this year, the share price of the company has risen from N3.60 to an all year high of about N7.00, representing an appreciation of about !00 percent. The company also stands in a position to make huge profits, as its main competitor-Michelin Tyres, has closed down earlier this year.
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