Ignite Investments and Commodities Limited, which acquired 970,166,694 shares in Forte Oil Plc, from Zenon Petroleum & Gas Limited, Thames Investment Incorporated, and Femi Otedola for N66.25 per share, is offering to acquire up to 500,000 shares from other shareholders of the petroleum firm.
The shares that represent 0.04 per cent of the total issued and fully paid-up capital of Forte Oil Plc , are to be acquired from existing shareholders at the same price of N66.25 paid to Zenon Petroleum & Gas Limited. It will also bring the shareholding of the Ignite Investments and Commodities Limited, to 74.06 per cent.
According to the company, the offer is to enable Ignite Investments comply with the obligations under Part XII of the ISA and Rules 445 – 448 of the SEC Rules and Regulations, which arose by its acquisition of 74.02 per cent of the total issued and fully paid up share capital of Forte Oil Plc.
Analysts at Meristem Research have made a buy recommendation on the stock considering its current price of N15.40, and a December 2019 target price of N24.95, which showed an upside potential of 62.01 per cent.
“The offer price of N66.25 represents an upside potential of 330.19 per cent, far above our projected upside. At this price clients are encouraged to offer up their existing holdings for sale,” Meristem Research said.
The Managing Director/CEO of Forte Oil Plc, Mr. Olumide Adeosun, who assumed office last June after the acquisition from Zenon Petroleum, said the company’s strategic future focus would be on people, customers, shareholders and corporate governance.
Adeosun said that the company would focus on increasing volumes, diversifying business operations, widening distribution networks and extracting potential synergies to boost revenue.
According to him, the company would also invest massively in the downstream sector to achieve desired growth.
He said that despite the regulated price of petrol product in the country, Forte Oil would still break even in other petroleum products in the downstream sub-sector.
The Forte Oil boss said that the company was also investing in Liquefied Petroleum Gas (LPG) through partnership with Prudent Energy on 6,000 metric tonnes which is expected to commence in July.
“We have about 800 metric tonnes storage facility in Apapa that will ease products distribution across the country,” he added.