Oando Climbs by 11% on Investors Positive Sentiment
Equities investors increased their positions in Oando Plc last week, causing its share price to surge by 11.3% after Federal High Court held that the company cannot force minority shareholders to sell their shares if they do not want to sell.
Following the verdict, investors rushed like swarms to increase their interest in anticipation that Oando Plc has strong potential to deliver better return.
Oando Plc’s market value reached N226.873 billion on Friday, up by 11.3% from the beginning of the week. Its share price climbed to N18.25 from N16.40 with 12.432 billion outstanding shares.
At the current market value, Oando Plc is trading at 6.65% discount to its peak price. The company share price had peaked at N19.55 before it nosedived. In the last 52 week, the oil company share price’s lowest level was N5.10 as an unending legal battle weighed on investors’ sentiment.
In April, Oando told the Nigerian Exchange that the Federal High Court, Lagos Division, further adjourned the petition in Suit No: FHC/L/CP/494/2021–Venus Construction Company Limited &13 others vs. Ocean and Oil Development Partners Limited and Oando PLC, which was filed in Court on March 25, 2021 to June 24, 2024.
The company said the adjournment to June 24, 2024, was for the Court to rule on the pending applications brought before it by certain shareholder.
These shareholders sought to be joined to the petition and challenging the Court’s order dated June 7, 2022, which, among other orders, directed the Company to file its Scheme of Arrangement document with the Securities and Exchange Commission (SEC) and the NGX within 30 days.
The previous court order mandated a majority shareholders to acquire minority interest at N7.70 per share. However, time and even passed as the company share price surged to N18.25 on Friday after Justice Chukwujekwu Joseph Aneke delivered a verdict that minority shareholders cannot be forced to sell.
According to the company’s audited financial statement for 2022, Ocean and Oil Development Partners Limited (OODP) owns 7,131,736,673 shares, representing 57.37% of Oando Plc. Data from the Nigerian Exchange showed that Oando Plc has 12.431 billion outstanding shareholdings in the market.
The company’s fortune is tied to oil market performance. High crude oil price has provided support level for the company’s earnings expectation as it seeks to clear backlog of audited and unaudited financial reports.
At the end of the week, oil prices showed a mixed performance due to a strong dollar and concerns about China’s economy, despite a tightening supply outlook.
Brent oil decreased by 0.58% to $84.54 per barrel, while WTI increased by 0.06% to $82.26 per barrel. In contrast, the price of gold fell by 0.45% to $2,409.70 per ounce. #Oando Climbs by 11% on Investors Positive Sentiment
