Continental Reinsurance Shares Suffer Decline on Profit Taking
Profit taking in the shares of Continental Reinsurance Plc (CRe Nigeria) led to a decline of 12.5 per cent to close lower at N1.75 per share last week. The new price offers investors a higher premium on the N2.04 that Continental Reinsurance African Investments Limited (CRe Investments) has proposed to buy all the outstanding shares of CRe Nigeria.
The board of CRe Nigeria
A Mutual fund (Unit Trust)
recently said it received an offer from CRe African Investments Limited to acquire all the outstanding and issued shares through a scheme of arrangement.
According to company, CRe Investments is making this offer in order to initiate a much needed restructuring exercise for CRe Nigeria, with a view to consolidating the CRe Nigeria’s operations and repositioning it for enhanced competitiveness in the global insurance market.
The shares of the reinsurance
is an investment vehicle managed by a SEC (Securities and Exchange Commission) registered Fund Manager. Investors with similar objectives buy units of the Fund so that the Fund Manager can buy securities that willl generate their desired return.
An ETF (Exchange Traded Fund)
is a type of fund which owns the assets (shares of stock, bonds, oil futures, gold bars, foreign currency, etc.) and divides ownership of those assets into shares. Investors can buy these ‘shares’ on the got a boost after the news broke. However, profit taking by some investors led to decline in the price of the equity, falling from N2.00 to N1.75 last week
CRe Investments is offering N2.04 per share for the 10,372,744,314 ordinary shares of 50 kobo each or one ordinary shares of $1 each in the capital of CRe Investments for every 176 ordinary share of 50 kobo each held in CRe Nigeria
It is intended that the transaction will be executed through a
floor of the Nigerian Stock Exchange.
A REIT (Real Estate Investment Trust)
is an investment vehicle that allows both small and large investors to part-own real estate ventures (eg. Offices, Houses, Hospitals) in proportion to their investments. The assets are divided into shares that are traded on the Nigerian Stock Exchange.
GUIDE TO DATA: Date: 12-2018,
All fund prices are quoted in Naira as at unless otherwise stated.
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Scheme of Arrangement under Section539 of the Companies& Allied Matters Act Cap C20 Laws of the Federation of Nigeria 2004 and other applicable rules and regulations.
The company said it had received the Securities & Exchange Commission’s ‘No Objection ‘to the scheme.
The scheme is also subject to the approval of the shareholders at a Court
Ordered Meeting as well as the sanction of the Federal High
Offer price: Bid Price: Yield/Total Return: NAV:
Court. The meeting is scheduled to hold on December 20, in Lagos.
Continental Reinsurance recorded a decline of 23 per cent in profit before tax (PBT) from N4.65 billion in the 2016 financial year to N3.57 billion in 2017. Profit after tax (PAT) dropped by 21 per cent from N3.12 billion in 2016 to N2.47 billion in 2017.
Despite the reduction in bottomline, the board of directors had resolved to maintain the same level of dividend as in the previous year, which was 14 kobo per share.
The price at which units of a trust or ETF are bought by investors. The price at which Investors redeem (sell) units of a trust or ETF. Denotes the total return an investor would have earned on his investment. Money Market Funds report Yield while others report Year- to-date Total Return. Is value per share of the real estate assets held by a REIT on a specific date.
Chairman of Continental Reinsurance, Chief Ajibola Ogunshola had told shareholders at the last annual general meeting, that their vision for the firm to be the premier pan-African reinsurer is undaunted.
“Our view on Africa is permanent, our objective is an Africa that grows from within and our strategy is always towards taking advantage of the immense opportunities that abound across Africa for the benefit of all stakeholders,” he said.