Economy
Dangote Cement Shares Fall Amid Dispute With BUA Cement
By Dipo Olowookere
The shares of Dangote Cement seem to be suffering heavily on the floor of the Nigerian Stock Exchange (NSE) as a result of the lingering crisis the firm has with one of its main competitors at the market, BUA Cement.
Late last year, BUA Group wrote an open letter to President Muhammadu Buhari, accusing Dangote Cement, owned by Africa’s richest man, Mr Aliko Dangote, of conniving with top government officials of the Ministry of Mines and Steel, including using thugs and agents of the state to ensure that its (BUA Cement) operations in Okpella, Edo State, were disrupted despite a suit pending before a Federal High Court due for hearing on December 5 and 6, 2017.
The Ministry of Mines and Steel is headed by a former Governor of Ekiti State, Mr Kayode Fayemi.
The letter, titled ‘A Cry for Help: Wanton Abuse of Power by a serving Minister geared towards sabotaging operations of BUA Cement,’ was dated December 4, 2017.
Executive Chairman/CEO of BUA Group, Mr Abdulsamad Rabiu, had urged the President to urgently intervene and investigate what it called the acts of sabotage against BUA Cement operations by Dangote Group.
He had stressed that, “The actions of Dangote Group with the collusion and connivance of highly placed officials of government especially the Minister is directed towards destroying the business of BUA cement with the ultimate goal of creating a monopoly in the cement industry in Nigeria and control the entire cement industry and market in the country.
“This with due respect should not be allowed in a democracy and a free market. Allowing such eventual monopoly is not only inimical to the growth of the cement industry and its attendant effect on the cost of construction and housing delivery to the mass of Nigerians, but also the economic wellbeing of the nation as a whole.
“It is worrisome that Dangote Group with all its visibility and international reputation is displaying such utter lack of respect for and trust in the Nigerian Judiciary.”
Days later, Dangote replied BUA Group, accusing the firm of using thugs and security operatives to carry out illegal mining activities on its mines site.
Dangote’s Executive Director, Mr Devakumar Edwin, while reacting at a press conference in Lagos, had said, “It is appalling that BUA Group in the midst of overwhelming facts want the public to believe that Dangote Group is after its business when in actual fact BUA has been the one mining illegally in Dangote Mining Lease and attacking its officials without any justification.
“The crocodile tears being shed by BUA in its cry for help and open letter to the President is most laughable and a total distraction from BUA’s continuous illegal activities within Dangote’s ML 2541 aimed at depleting and exhausting the limestone reserves in order to sabotage Dangote Group’s legitimate investment.”
In order for the crisis not to result into a breakdown of law and order, the Edo State government led by Mr Godwin Obaseki, shut down the disputed site, pending when a peaceful resolution would be reached by the aggrieved parties.
However, Business Post gathered that since the crisis started, the shares of Dangote Cement have been in freefalling mode.
A check by this newspaper showed that the share price of Dangote Cement, which traded at N245.80k per share on December 4, 2017, closed the last trading day of last year, December 29, at N230 per share.
Also, Dangote Cement opened for the first trading day of 2018 last Tuesday at N230 per share, but ended the week, Friday, January 5, 2018, at N223.11k per share.
According to details of the firm fetched by Business Post from the NSE website, Dangote Cement has authorized shares of 20 billion, but as the close of trading activities last Friday, it has an outstanding of 17.04 billion with a market capitalisation of N3.8 trillion.
How long the crisis between both firms would last is not known yet, but investors are getting worried that it might continue to bite hard on Dangote Cement’s shares.
A closer look at the shares of the company this year showed that it lost N7 on the second trading day of 2018 to close at N223 per share, but marginally gained 11k the next day to finish at N223.11k per share, and settled for the week at the same rate after trading flat.
Dangote Cement controls 65 percent of the market share in Nigeria and this was confirmed last year when the firm released its half year financial statements.
“As a result of the slower market, our Nigeria operation sold nearly 6.9Mt of cement, down 21.8 percent on the 8.8Mt sold in the first half of 2016. We estimate our market share to have been about 64.5 percent during the first six months of 2017,” Chief Executive Officer of the company, Mr Onne van der Weijde, had said.
By Adedapo Adesanya
The duo of MRS Oil and FrieslandCampina Wamco Nigeria Plc weakened the NASD Over-the-Counter (OTC) Securities Exchange by 0.68 per cent on Friday, June 5.
MRS Plc lost N19.00 during the session to sell at N171.00 per share compared with Thursday’s value of N190.00 per share, and FrieslandCampina Wamco Nigeria Plc depreciated by N8.70 to finish at N181.68 per unit compared with the preceding session’s N190.38 per unit.
As a result, the market capitalisation further lost N22.59 billion to close at N2.607 trillion versus the N2.630 trillion it ended a day earlier, and the NASD Unlisted Security Index (NSI) dropped 37.76 points to settle at 4,358.32 points, in contrast to the previous day’s 4,396.08 points.
The alternative stock market closed the last trading day of this week with a price gainer, Central Securities Clearing System (CSCS) Plc, which gained 6 Kobo to quote at N78.40 per share compared with the preceding session’s N78.34 per share. However, it could not prevent the market from going down at the close of business.
Yesterday, the volume of securities bought and sold by investors went down by 50.0 per cent to 140,345 units from the preceding day’s 280,714 units, the value of stocks decreased by 16.5 per cent to N17.9 million from the previous session’s N21.5 million, and the number of deals carried out by market participants fell by 35.7 per cent to 27 deals from the 42 deals recorded on Thursday.
When trading activities closed for the day, Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis, with 3.4 billion units exchanged for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 64.7 million units traded for N4.4 billion.
GNI Plc also ended the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units transacted for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
By Dipo Olowookere
Renewed interest in financial stocks and others lifted the Nigerian Exchange (NGX) Limited by 0.15 per cent on Friday.
Customs Street closed higher yesterday despite the 1.37 per cent loss recorded by the consumer goods sector as a result of profit-taking.
This was offset by gains in the other key sectors of the local bourse, as the insurance counter chalked up 1,14 per cent. The banking space appreciated by 0.90 per cent, the industrial goods segment grew by 0.46 per cent, and the energy sector expanded by 0.01 per cent.
Consequently, the All-Share Index (ASI) went up by 366.00 points to 242,593.31 points from 242,227.31 points, and the market capitalisation gained N235 billion to close at N155.594 trillion compared with the previous day’s N155.359 trillion.
The trio of International Energy Insurance, Abbey Mortgage Bank, and DAAR Communications improved by 10.00 per cent each yesterday to N7.26, N9.35, and N1.98, respectively, while Zichis advanced by 9.39 per cent to N32.38, with Sovereign Trust Insurance up by 8.70 per cent to N2.50.
On the flip side, Academy Press lost 9.84 per cent to quote at N8.25, University Press depreciated by 9.73 per cent to N5.10, Africa Prudential dipped by 2.63 per cent to N12.95, Chams crumbled by 2.44 per cent to N4.00, and International Breweries slipped by 1.59 per cent to N12.35.
Business Post reports that the market breadth index was positive during the session after recording 37 appreciating equities and 14 depreciating equities, implying strong investor sentiment.
Abbey Mortgage Bank led the activity chart with a turnover of 164.1 million units worth N1.5 billion, Ellah Lakes sold 76.7 million units for N767.2 million, Access Holdings transacted 44.8 million units valued at N1.1 billion, Linkage Assurance exchanged 23.0 million units worth N41.2 million, and The Initiates traded 20.2 million units for N562.1 million.
At the close of trades, market participants transacted 608.5 million units worth N32.0 billion in 53,826 deals versus the 588.5 million units valued at N27.9 billion executed in 57,352 deals in the previous session. This showed that the number of deals eased by 6.15 per cent, the volume of transactions rose by 3.40 per cent, and the value of transactions soared by 14.70 per cent.
By Adedapo Adesanya
The Naira further depreciated against the United States Dollar by N3.46 or 0.25 per cent to N1,362.21/$1 from N1,358.75/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, June 5.
However, it appreciated against the Pound Sterling in the same market window during the session by N4.47 to trade at N1,823.59/£1 compared with the previous day’s N1,828.06/£1, and gained N7.00 against the Euro to sell at N1,574.58/€1, in contrast to Thursday’s closing price of N1,581.58/€1.
For another trading session, the Nigerian Naira maintained stability against the Dollar in the parallel market and the GTBank forex counter on Friday at N1,375/$1 and N1,372/$1, respectively.
The Naira is expected to remain strong in the near term, backed by a rise in external reserves, which are nearing $50 billion, enhancing analysts’ confidence about its outlook in the second half of 2026.
Heightened global uncertainty has reduced the incentive for importers and corporates to demand FX, as cautious trade weighs on import needs. Analysts estimate a $40 billion net FX position for the year, a projection anchored in oil windfall gains.
As for the cryptocurrency market, prices remained depressed following a strong US jobs report that spurred markets to price in higher-for-longer interest rates, sending Treasury yields and the dollar up while hammering stocks, especially AI-related names. Crypto markets saw heavy leverage washouts with about $1.6 billion in positions liquidated over 24 hours.
Ethereum (ETH) gave up 4.9 per cent to trade at $1,584.68, Solana (SOL) fell by 3.3 per cent to $63.22, Bitcoin (BTC) crashed by 1.9 per cent to $61,333.23, Dogecoin (DOGE) slipped by 1.8 per cent to $0.0821, and Ripple (XRP) moderated by 1.8 per cent to $1.09.
Further, TRON (TRX) dropped 1.6 per cent to sell at $0.3197, Binance Coin (BNB) slumped by 1.0 per cent to $581.18, and Cardano (ADA) declined by 0.4 per cent to $0.1589, while the US Dollar Tether (USDT) gained 0.07 to sell at $0.9997, and US Dollar Coin (USDC) closed flat at $0.9998.
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