Afromedia PP

[Nico J]

I am not a professional in these matters. However, I thought the essence of underwriting is an undertaking/guarantee to absorb to the extent of your underwriting, if it is not taken up by the public or anyone else. More like an insurance of sale.
Please I will like to learn from other contributions.

[BLUEMONEY]

Originally Posted by Coolhead

I have a bit of a concern about this Afromedia PP, not necessarily on the PE of 26, or the offer price. I'm actually worried about some soft issues that could easily be glossed over.

1) How come Ecobank is underwriting 60% on a firm basis and at the same time selling that 60% off by way of an Offer fo Sale in the same placement exercise? That's a very strange arrangement, isn't it? Simply put, it appears there is no underwriting. My take is that Afromedia was indebted to Ecobank, which probably became a bad debt and a debt conversion arrangement was hastily made, preparatory to packaging a private placement - effectively pushing the bad debt to the public.

2) Utilization of funds is stated only in percentages, without the real figures accompanying them. Investors have to work the figures out, don't they? Another strange and unusual practice, I think.

So I don't start to think these are deliberate acts of deceit, I'd appreciate a discussion on these issues.

On the first point you raised, i will say it is not neccesarily a bad debt that is been packaged to the public as PP. what we have been seeing for a while is that most of these banks will invest in a company and after sometime when the company is strong and making profit may decide to cashout either by selling thier holding to another institutional investor or as in this case doing a PP. i believe ecobank decided to do a PP with this one becuase they will cashout big unlike looking for an institution that will not pay as much for thier 60% holding. this type of underwriting is very unusual and i believe should just be called what it realy is DIVESTING. we will be seeing more of this in the future i believe.
On your second point, i see nothing wrong with stating the utilization of funds in percentage only. they are not the first and i believe wont be the last.

[zainabusman]

Originally Posted by BLUEMONEY

On the first point you raised, i will say it is not neccesarily a bad debt that is been packaged to the public as PP. what we have been seeing for a while is that most of these banks will invest in a company and after sometime when the company is strong and making profit may decide to cashout either by selling thier holding to another institutional investor or as in this case doing a PP. i believe ecobank decided to do a PP with this one becuase they will cashout big unlike looking for an institution that will not pay as much for thier 60% holding. this type of underwriting is very unusual and i believe should just be called what it realy is DIVESTING. we will be seeing more of this in the future i believe.
On your second point, i see nothing wrong with stating the utilization of funds in percentage only. they are not the first and i believe wont be the last.

I am inclined to believe this bad debt issue. Afterall Afromedia did say some of the proceeds will be used to pay off debt.

Secondly, as recent as end of 2006 Afromedia had negative equity due to 5 consecutive years of losses! Can u imagine. Infact as far as i am concerned they are still in negative territory at the end of 2007. They had a retained loss of N133.5 million and capital of N10 million, negative equity of N123.5 million. They now played some accounting gymnastics at the end of 2007 by revaluing some assets by a whooping N1.7 billion to close the year with positive equity. Imagine this wayo.

Yet they are selling the company at N2.92, the forward PE for 2008 is 26.5 and for 2009 is 10. Imagine.

Anyway i am not buying Afromedia cos its too expensive and the company is not solid. Even BGL one of the issuing houses issued a cautios long term buy opinion.

I urge members to be cautious with all this PP business. The ones i have seen of recent are simply not worth the risk.

[BLUEMONEY]

Originally Posted by zainabusman

I am inclined to believe this bad debt issue. Afterall Afromedia did say some of the proceeds will be used to pay off debt.

Secondly, as recent as end of 2006 Afromedia had negative equity due to 5 consecutive years of losses! Can u imagine. Infact as far as i am concerned they are still in negative territory at the end of 2007. They had a retained loss of N133.5 million and capital of N10 million, negative equity of N123.5 million. They now played some accounting gymnastics at the end of 2007 by revaluing some assets by a whooping N1.7 billion to close the year with positive equity. Imagine this wayo.

Yet they are selling the company at N2.92, the forward PE for 2008 is 26.5 and for 2009 is 10. Imagine.

Anyway i am not buying Afromedia cos its too expensive and the company is not solid. Even BGL one of the issuing houses issued a cautios long term buy opinion.

I urge members to be cautious with all this PP business. The ones i have seen of recent are simply not worth the risk.

I have taken into consideration the accounting gymnastics because it is very clear from thier financials and i believe i have said it before this PP is expensive. but what struck me from your comment was that BGL issued a cautious long term buy opinion.

[lynste]

After going through all analysis i have decided to be more cautious because my broker wants the deal through. Afterall bulk of it is to service debt.

lynste

[hispy99]

Afromedia records oversubscription in private placement
By Gbenga Agbana

AFROMEDIA Plc, a pioneer and leading Out-of-Home media company, has announced an over-subscription in its recently concluded private placement, which closed at the end of May 2008.

The company, which received approval of change of name to Afromedia Plc is also considering listing its shares in the equities sector of the Nigerian Stock Exchange (NSE).

In a release made available to The Guardian recently, the Managing Director of the company, Akin Ire Olopade, said that oversubscription is a clear evidence of high confidence that investors repose in their company.

Following the successful completion of the private placement, Afromedia, which recently received approval of change of name to Afromedia Plc, is now positioned to harness Out-of-Home media business opportunities across Africa. "Plans are currently being concluded for the entry into these markets and will be disclosed at the appropriate time", said the managing director.

The private placement price, which was sold for 2.92 kobo per unit, raised funds for the company to the tune of over N3 billion exceeding its proposed target, while also allowing major investors including Ecobank Development Corporation to reduce their holdings.

Olopade explained that the chunk of the money would go into the expansion of the company's operations with focus on human capital, research and development of new products and technology, which is expected to translate to high returns in investment to its shareholders.

He then called on discerning investors to embrace the company's shares, which will soon be available on the stock market.

The company, with 80 years expertise, has continued to be at the forefront of the industry with achievement including; the first to locally produce the first screen-printed poster in the country; first four-colours half-tone screen-printed posters in Nigeria, media in the market place concept and by the design, fabrication and installation of the most advanced US standard mono-pole, double-face, centre-mount tower billboard amongst others.

"We are happy to achieve this and we are thankful to all our shareholders for the confidence they repose in us. We achieved this simply because of our performance in the past years and we promise our old and new shareholders more high", he added.

Afromedia Plc was initially established as a division of UAC in 1928. Through the efforts of its management team led by Akin Ire Olopade, has grown to become the largest Out-of-Home media company in Nigeria.

The company was incorporated as West African Publicity (WAP), and later incorporated in 1928 as part of the parent United Africa Company Limited (UACL) to offer media contracting services and agency service.

[saidone technology limit]

pls has anyone recieved the cerificate of this pp?

[BLUEMONEY]

Originally Posted by saidone technology limit

pls has anyone recieved the cerificate of this pp?

No certificate yet. still waiting for mine.

[hispy99]

Afromedia warms up for listing on NSE
By Gbenga Agbana

PREPARATION to the company's listing on the Nigerian Stock Exchange, Afromedia Plc has appointed Dr. Onaolapo Soleye as the chairman of its Board of Directors, following the reconstitution of its board at a meeting held in Lagos.

Also, Mr. Sunday Nwachukwu has been appointed a director of the company to support the management in sterring the business to greater success, according to Mr. Patrick Nwabunie, the chief operating officer of Afromedia Plc, a media contracting services and agency service company.

The company's Managing Director, Mr. Akin Ire Olopade said the company's recent private palcement was largely oversubscribed to the turn of over N3 billion, thereby exceeding its proposed target, while also allowing major investors to reduce their hodlings.

He called on discerning investors to embrace the company's shares, which would soon be available on the stock market.

Olopade said the appointments of Soleye, a former Finance minister and Nwachukwu were in line with Afromedia's overall strategy for maintaining its leadership position in the out-of-home media industry and for taking the company to the next level.

He said, "we are privileged to have Soleye as chairman and Mr. Sunday Nwachukwu as director and are very confident that they will support the management of the company in steering the business to greater success."

[solainvest]

An interview with an outdoor advertising MD (a different company). For those that invested, it might worthwhile to read and keep informed....

To get the full interview, click on the link...

The Sun News On-line| Ceo Magazine

In the Eastern part of the country, Rocana Nigeria Limited has carved a niche for itself in outdoor advertising. For 33 years, Rocana has been playing a kingly role in the region and dominating its advertising landscape. In the ‘80’s when other agencies were still using wooden billboards, Rocana introduced steel billboards that marked the beginning of a revolution in the industry in the country.

Today, Rocana has not only conquered the outdoor advertising sub-sector, East of the Niger, it has also spread its tentacles beyond the region just as it is moving a notch higher by going into production of printers and packaging materials.

Also, Rocana recently secured the franchise to add the new Face of Imo by constructing 50 ultra-modern bus shelters in the heartland state. According to Oji, apart from the shelters providing shade for pedestrians, it would afford corporate bodies in Imo opportunity to advertise their products.

Excerpts:

Background
My name is Robert Oji. I am the CEO and Managing Director of Rocana Nigeria Limited. Rocana Nigeria Limited was incorporated in 1975 and from inception, we have been in the production of advertising materials, printing and eventually ventured into outdoor advertising. We got our membership in 1984 with OAN; APCON in 1988; the Nigerian Institute of Public Relations in 1985. We have our head office in Enugu . We also have branches in Lagos, Aba, Port Harcourt and planning to go to Abuja .


Why our other clients queued behind Monarch
They saw consistency, they saw reliability, they saw the strength in handling jobs within our area, they saw that response time for production, installation, hoisting of billboards was there, as well as the response time for maintenance which was an advantage for somebody who is over here in the East handling their jobs. We took advantage of all these.

Challenges
Actually, we have many challenges. In the ‘70’s and ‘80’s, we were not having the challenges that we were faced with in the ‘90’s and from 2000 till now we are having extra challenges ranging from multiple taxation by government agencies; local governments will demand taxes; internal revenue which is normally federal and state’s; the Ministry of Environment and several youths organizations in the states also impose levies . So, by the time you complete a job, you would have paid through your nose. This does not make for a healthy development of outdoor advertising and the government is not helping matters by not restricting anybody, so anybody jumps on outdoor to get his cut.

Regulating location of billboards
OAN has its regulations and APCON has its too, the regulations are there, they are printed and handed over to any member. The local governments have their regulations and the Ministry of Environment is coming up with its regulations; regulation changes, it has been revolving from inception till now. The local governments will allocate site to you and they say that the site should maintain 200 metres and by the time you install your billboard, assuming Rocana is in the East, assuming we take up a virgin site and somebody is coming from Lagos and some other persons have interest in giving him the same site and you have already given him your site list, so that he can give you the job, and he transfers it to his brother who is coming from Lagos. And then, he will come to that particular site you have described for them in your site list and hand it over to them and they will now come there to install their billboard, making the place to become a cluster.

So, the problem is from outdoor advertising practitioners, the problem is from agencies who try to patronize their people, friends and brothers from Lagos; the problem is from the local governments who permit them because they have the stipulations. Like the local government will authorize kiosks everywhere, all over town, likewise they will authorize every other thing, just pay them money, you will have site, it doesn’t matter who you are offending, whether you are stepping on anybody’s toes, they will just give you the site, but this will boomerang at the end of the day, the government doesn’t like it, the government is coming up with policies to impose control as we can’t control ourselves.

Relevance of outdoor advertising
The relevance of outdoor advertising cannot be over-emphasized because outdoor advertising has become a media tool to be reckoned with. One advantage it has is that in radio advertising, if there is no light you will use your money to buy battery, you can’t listen to the radio all the time because mostly there is no electricity supply; the same problem is applicable to television. That is for the electronic media; for the newspapers, Nigerians are not a reading public, they are not usually interested in reading, most of them who read, read for one purpose or the other, either for political reason or when they are looking for an advert to get a job or other things.

Besides, per capita income in Nigeria is too low for people to pick up the newspapers because of the poor economy. So, there are so many things inhibiting the media channels and that is why outdoor is the sure bet. In fact, from our statistics, we noticed that one billboard could be seen by both pedestrians, motorists and other commuters 24 hours 365 days a year; so, it does not choose any audience, every audience is entitled to view it as it is out there on the road. So, outdoor has a very big advantage and is very significant in the Nigerian situation now, that is why everybody is rushing to outdoor advertising.

Competition
One thing is sure; Rocana is coping because Rocana is a pioneer in outdoor advertising business in the Eastern part of Nigeria before other people joined. And those people who are coming from Lagos , that is, other outdoor advertising companies who are claiming to be national or international come to cluster the whole area. Other outdoor companies that are now coming up in the Eastern part of the country are even claiming that they are national. So, for Rocana, we have an advantage because we are maintaining only the billboards within our locality, within the East which will take us only three hours to go and render service either by the notice of the clients who get to inform us and we rush to the place within the next three hours; from here to Port Harcourt is about three hours, from here to Calabar is about three hours, so is Benin and Makurdi; so, we are on the job,we respond rapidly.

Quacks in outdoor advertising and the regulatory bodies
That is quite true and that is where the trouble lies; both the government and OAN, APCON are not doing much on the regulatory aspect of outdoor advertising because I have travelled abroad and I belong to international bodies. I have seen the way it is done abroad; it’s not the way it is done in Nigeria . Anybody who left school yesterday will come into outdoor, anybody who works for you will take off in the next one or two months and is into outdoor. He is competing with you, he is paying the local government and giving money under the table to boys in the agency and they will give him jobs. So, it is a difficult situation we are in actually.

Our innovations in billboard signs
Rocana actually in the ‘80’s produced steel boards when other outdoor companies were still using wooden board. We were then the first company to introduce steel boards to all our billboards in our areas of operation. Rocana later introduced Unipole, there are two, three agencies who started Unipole in Lagos before Rocana took over and we have so many Unipoles in our areas of operation.

Rocana is now working with foreign partners to get some other high-powered billboards like neon, we are doing neon now, we are doing revolving signs, we are trying to get in a digital signboard for which we must get a land, and, of course, we are now buying up some land where we can install the board permanently and then get a power generating set for it because they require regular power and we are also researching into solar energy; the kind of solar system they have now is not efficient, we are researching into it to know people who can give us more efficient solar system that can power the kind of billboards we have in mind. There are many new developments that Rocana is bringing into outdoor for better innovation of the system which some of the new people in outdoor may not be able to catch up with until later years.

Our other areas in advertising
That’s what I told you earlier, we are now moving forward despite all the challenges in outdoor; we are using vinyl, flexes; we are printing on them, we buy vinyl and flexes and print on them for our other colleagues who are in the industry. In 2005\2006, we ventured into large format and last year, we bought 15 large format printing machines as against the three we bought in 2006 and we have sold seven to Benin, Abuja and Port Harcourt. And my last trip last month to China has even exposed us the more that we are being offered to produce the printers here in Nigeria , here in Enugu State so that we can sell to the whole of Africa because the Chinese saw the potentialities in us and our seriousness.

[BLUEMONEY]

Originally Posted by hispy99

Afromedia warms up for listing on NSE
By Gbenga Agbana

PREPARATION to the company's listing on the Nigerian Stock Exchange, Afromedia Plc has appointed Dr. Onaolapo Soleye as the chairman of its Board of Directors, following the reconstitution of its board at a meeting held in Lagos.

Also, Mr. Sunday Nwachukwu has been appointed a director of the company to support the management in sterring the business to greater success, according to Mr. Patrick Nwabunie, the chief operating officer of Afromedia Plc, a media contracting services and agency service company.

The company's Managing Director, Mr. Akin Ire Olopade said the company's recent private palcement was largely oversubscribed to the turn of over N3 billion, thereby exceeding its proposed target, while also allowing major investors to reduce their hodlings.

He called on discerning investors to embrace the company's shares, which would soon be available on the stock market.

Olopade said the appointments of Soleye, a former Finance minister and Nwachukwu were in line with Afromedia's overall strategy for maintaining its leadership position in the out-of-home media industry and for taking the company to the next level.

He said, "we are privileged to have Soleye as chairman and Mr. Sunday Nwachukwu as director and are very confident that they will support the management of the company in steering the business to greater success."

The Market should stabilize on time so that these guys can Approach the Exchange for listing. if they go now, Chances are, they will be turned down.

[maxiakala]

Afromedia warms up for listing, strengthens management
By Gbenga Agbana

AHEAD of its listing on the Nigerian Stock Exchange, Afromedia Plc, Nigeria's premier advertising company has strengthened its board and management.

Preparatory to the listing, the company has also successfully completed its private placement, and now has about 1,734 shareholders, and currently has the highest capitalisation and asset base of over N5 billion in the outdoor industry in the country.

Speaking at an event organised for the company by Synergy Capital Advisory Limited, the Managing Director of Afromedia Limited, Mr. Akin Olopade, said: "We are going to be listed on the stock exchange soon, and we have repositioned well for that. We have grown our profit margin by 500 per cent in the last one year, and our profit margin is over N1 billion in the last one year.

"We planned to acquire some companies in the West Africa, and we are planning to become a Pan-African company".

Deputy Managing Director of Synergy Capital Advisory Limited. said "the need to restructure Afromedia Plc came as a result of the organisation's repositioning strategy. By choosing the right partner in Synergy Capital, Afromedia Plc was able to tap into Synergy capital's sound financial expertise in order to achieve their corporate vision." With the aid of a strong management team, Synergy Capital group was instrumental in raising the required capital and to position Afromedia as the leading OOH media in the continent and finding the right mix for Afromedia Plc new Board of Directors.

Synergy Capital & Advisory Limited was incorporated in January 2007 to provide bespoke business and financial advisory services, funds management and investment fiduciary and capital structuring services. The company's objective is to use their sound understanding of the Nigerian business and financial environment, significant experience advising & financing various industry sectors, and excellent specialist finance knowledge and skills to offer its clients world class advisory services.

The unveiling cocktail of the new Afromedia board of directors is to showcase the corporate turnaround team that would take Afromedia Plc to the next level in OOH advertising in the continent. This new board which is made up of technocrats and accomplished businessmen is led by Dr. Onaolapo O. Soleye who used to be a former Minister of Finance, Akin Ire Olopade - Group Managing Director/CEO, Engr. Patrick O. Nwabunie - Group Deputy MD/COO, Sunday O. Shadrach Nwachukwu - Group Finance Director, Alhaji Mohammed Gobir-Non-Executive Director and Chief Alex Amorighoye - Non Executive Director.

[BLUEMONEY]

Originally Posted by maxiakala

Afromedia warms up for listing, strengthens management
By Gbenga Agbana

AHEAD of its listing on the Nigerian Stock Exchange, Afromedia Plc, Nigeria's premier advertising company has strengthened its board and management.

Preparatory to the listing, the company has also successfully completed its private placement, and now has about 1,734 shareholders, and currently has the highest capitalisation and asset base of over N5 billion in the outdoor industry in the country.

Speaking at an event organised for the company by Synergy Capital Advisory Limited, the Managing Director of Afromedia Limited, Mr. Akin Olopade, said: "We are going to be listed on the stock exchange soon, and we have repositioned well for that. We have grown our profit margin by 500 per cent in the last one year, and our profit margin is over N1 billion in the last one year.

"We planned to acquire some companies in the West Africa, and we are planning to become a Pan-African company".

Deputy Managing Director of Synergy Capital Advisory Limited. said "the need to restructure Afromedia Plc came as a result of the organisation's repositioning strategy. By choosing the right partner in Synergy Capital, Afromedia Plc was able to tap into Synergy capital's sound financial expertise in order to achieve their corporate vision." With the aid of a strong management team, Synergy Capital group was instrumental in raising the required capital and to position Afromedia as the leading OOH media in the continent and finding the right mix for Afromedia Plc new Board of Directors.

Synergy Capital & Advisory Limited was incorporated in January 2007 to provide bespoke business and financial advisory services, funds management and investment fiduciary and capital structuring services. The company's objective is to use their sound understanding of the Nigerian business and financial environment, significant experience advising & financing various industry sectors, and excellent specialist finance knowledge and skills to offer its clients world class advisory services.

The unveiling cocktail of the new Afromedia board of directors is to showcase the corporate turnaround team that would take Afromedia Plc to the next level in OOH advertising in the continent. This new board which is made up of technocrats and accomplished businessmen is led by Dr. Onaolapo O. Soleye who used to be a former Minister of Finance, Akin Ire Olopade - Group Managing Director/CEO, Engr. Patrick O. Nwabunie - Group Deputy MD/COO, Sunday O. Shadrach Nwachukwu - Group Finance Director, Alhaji Mohammed Gobir-Non-Executive Director and Chief Alex Amorighoye - Non Executive Director.

While they are warming up to list on the Exchange, they should also be warming up to send me my certificate.

[edunko]

has anyone in the house recieved his certificate of this PP and any info on when they will be listing