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Wednesday, September 28, 2022

Multinationals Bet Big on Nigerian Subsidiaries with Major Stock Purchases

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Foreign Multinationals are seeing some value in beaten down units of their domestic Nigerian subsidiaries with major stock purchases over the past 4 months.

Foreign multinationals with substantial shareholdings in Nigerian units have bought some N2.16 billion worth of shares since May, according to data compiled by MoneyCentral.

The equity purchases largely cut across the consumer goods sector with Nigerian Breweries, Unilever, Nestle Nigeria and Flour Mills being the major beneficiaries.

Heineken Brouwerijen B.V, the largest single shareholder in Nigerian Breweries with a 37.76 percent stake bought an additional 7.3 million shares in the period for a total consideration of N260 million between August 11th and 21st, 2020.

The shares were purchased at an average price of N35.8. Nigerian Breweries closed trading at N36 per share on Tuesday.

Nestle S.A, which is the major shareholder in Nestle Nigeria increased its shareholding by 636,384 shares just last week at N1,174.67 per share, for a total consideration of N747 million.

Nestle closed trading at N1,175 per share. Excelsior Shipping Limited and Unilever Overseas Holdings B.V., also increased their ownership stakes in Flour Mills and Unilever Nigeria Limited respectively.

Unilever Overseas spent N1.04 billion on increasing its stake in Unilever Nigeria since August 10. While foreign multinationals are increasing their stakes Nigerian fund managers are largely shunning stocks.

Nigerian Pension Fund Administrators (PFAs), holdings of domestic equities shares fell to N524.7 billion for the period, from N530.1 billion in May.

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