Nipco Investments Ltd has filed a formal application with the Securities and Exchange Commission (SEC) for an
“Authority to Proceed” with the acquisition of ExxonMobil Oil Corporation (EMOC) 60 percent equity ownership in Mobil Oil Nigeria plc.
In a message to the Nigerian Stock exchange (NSE), Mobil Oil Nigeria said the acquisition of EMOC’s 216.357 million ordinary shares by Nipco will be for the consideration of $301 million subject to price adjustments for dividends and other factors.
This brings the total value of the deal to $500 million, based on Business Day’s calculations.
Analysts say the deal will inevitably maximize share holders value since it is at a premium over the market value of Mobil Nigeria.
Mobil Nigeria closed trading in Lagos at N241.89 per share and had a market capitalisation of N87.2 billion.
“This price is a significant premium on market valuation for Mobil because it translates to a pricing of about N424 per share at the interbank dollar rate of N305/$1,” said Dolapo Oni, head of energy research analyst with Ecobank Plc, in an emailed note to Business Day.
“While such a premium typically captures goodwill and other brand value, there may have been room for some fiscal discipline. I believe ExxonMobil has gotten a really good deal, especially in this current market,” said Oni.
