Company To Raise N1bn Fresh Capital

Portland Paints and Products Nigeria (PPPN) Plc has secured the approval of the Nigerian Stock Exchange (NSE) to raise N1.02 billion in new equity funds in its bid to expand its business.
A regulatory document at the NSE indicated that the Quotation Committee of the Exchange, which oversees new and supplementary issuance and listing, has approved the application submitted by the board of directors of Portland Paints and its professional advisers.
The company would be raising N1.02 billion through a rights issue of 600 million ordinary shares of 50 kobo each at N1.70 per share. The provisional allotment for the rights issue is on the basis of three new ordinary shares for one ordinary share.
The rights issue price of N1.70 represents a discount of 5.5 per cent to the market value of N1.80 per share at the NSE.
Recently, the chairman of Portland Paints, Mr. Larry Ettah said the new equity funds would be used to restructure the company’s balance sheet and support its business expansion programme.
“We will apply the planned rights proceeds to minimise the debt exposure risks of our business as well as carry out targeted expansion in our operations. The business will focus on its growth brands as well as make the necessary investment in marketing to improve its brands’ awareness and visibility,” Ettah said.
He said the company had embarked on intensive restructuring of its operations in order to strengthen it against challenges that had negatively impacted its operations.
Ettah explained that Portland Paints embarked on restructuring as a result of the difficult and challenging economic and business environment.
He, however, noted that despite the challenges and risks posed by the business environment, the company with its flagship brand Sandtex, will continue to consolidate on the restructuring while seeking growth opportunities to deliver returns to the shareholders.
Key extracts of the third quarter result of the company for the period ended September 30, 2016 showed that turnover dropped to N1.36 billion, 18.56 per cent lower when compared to the N1.67 billion in 2015. It recorded loss after tax of N46.49 million in 2016 as against N115.19 million recorded in 2015.