Shares in Nigerian oil company Oando fell close to a one-month low on Monday on news that regulators were investigating the firm’s shareholding structure following its $1.65 billion acquisition of ConocoPhillips’ Nigerian business.
Shares in Oando, which are also listed in Johannesburg and Toronto, fell 9.54 percent in Lagos, down for the second session in a row, to a level last seen in June.
“Our attention has been drawn to a report … stating that Oando is under investigation by the Securities and Exchange Commission (SEC) following petitions filed by some foreign investors in Oando Nigeria Plc, in relation (to) shareholding structure,” it said in a statement.
Oando acquired ConocoPhillips’s Nigerian business in 2014 aimed at moving the business upstream into oil exploration and production from being a petroleum products retailer. But high financing costs coupled with lower oil prices have hit profits, analysts say.
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The company said it was aware that the regulator was in receipt of a petition but that the claims were “unsubstantiated, misleading and defamatory” and that it had received board, shareholder and where required SEC approval on the matter.
It added that the company was cooperating with the SEC.
Oando is Nigeria’s largest independent conglomerate in the energy industry, including petroleum products marketing, supply & trading, exploration and production, and gas distribution, and the first Nigerian company to achieve a dual listing on both the Nigerian and Johannesburg Stock Exchanges.
Oando is Nigeria’s largest indigenous oil company with a production output of 54,000 boepd and a market capitalisation of $894 Million.
Through its upstream subsidiary Oando Energy Resources (OER), Oando has a secondary listing on the Toronto Stock Exchange with a market capitalisation approximately $1 Billion.
The company’s earliest roots can be traced to the formation of Esso Africa in 1956. Esso Africa was a petroleum marketing company, a subsidiary of the Exxon Corporation of USA.
In 1976, the Nigerian government purchased a controlling stake in the company and rebranded the company as Unipetrol Nigeria.
On 1 March 1991, Unipetrol became a Public Limited company. Later on in the same year, the Nigerian government sold 60% equity to the Nigerian public in an Initial Public Offering.
By February 1992, Unipetrol was listed on the Nigerian Stock Exchange.
