HH Capital Limited acquired 9.7 billion units of Transcorp, bringing their total holdings to 25.6% of the company’s total shares.
Incredible!
Before now, Femi Otedola had acquired the first 5% of the stake in the company belonging to his friend and brother two weeks ago.
He went ahead last week to increase his stake by acquiring another 1.5% stake in Transcorp, taking his total stake to 6.5%.
The rumor out there is that Femi will not stop until he takes over Transcorp Group by acquiring 25% of the company.
Sensing blood and not wanting to be caught napping, Tony made his chess move by acquiring 25% of the company that he first bought in 2012.
With this move, Tony now has 36% ownership of Transcorp through direct and indirect means, placing the company firmly in his hands.
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Femi Otedola will definitely react to this move, but before he does, in case you are wondering why Transcorp is suddenly attractive and a beautiful bride to Femi Otedola,
Let me explain:
Transcorp is a conglomerate that owns the following assets:
Transcorp Hilton in Abuja and Lagos (the Lagos project is underway)
They own a power plant known as Genco in Ughelli and Afam.
The power plant is the group’s biggest cash-producing asset, as it brought over 410 billion naira to their bottom line last year.
Transcorp Hotel just brought in 31 billion.
Then the group owns an oil well, OML 19, which they bought from Shell two years ago for $1 billion.
The oil well has yet to start contributing anything to Transcorp’s group top line.
The business is not doing badly either, as they made a revenue of N442.7 billion in 2022, with a profit of 30 billion naira.
Femi Otedola’s target is the power plant.
He owns the Geregu power plant, and he has seen the possibilities and the value creation in that eco-system, and he believes that Tony is not running those power plants as efficiently as he should have.
For example, Gerugu alone is worth 800 billion naira, while Transcorp, which has two bigger power plants, is worth only 100 billion.
So Femi, with his eyes set on the power plants owned by Transcorp, wants to unlock the true potential of the business.
We anxiously await Femi Otedola’s next move in the chess game and power struggle for Transcorp’s soul following Tony Elemelu’s chess move today to protect his company.
Chukwudi Iwuchukwu
