UPDC Shops for N15.962bn Fresh Capital from Existing Shareholders

UAC Nigeria Property Development Company Plc on Monday began the process of raising about N15.962 billion from existing shareholders as part of its recapitalisation and restructuring efforts.

The company, which in its unaudited 2019 full year financial results, reported loss of N16.275 billion, is raising the fresh capital through a rights issue of 15.962 billion ordinary shares of 50 kobo each at N1.00 per share.

UAC of Nigeria (UACN)Plc, which is the parent firm of UPDC last year announced a collective consideration of strategic initiatives involving a recapitalisation and restructuring of UPDC.

UACN had explained that it was in the process of a strategic review, evaluating its performance and its subsidiaries. The objective is to achieve sustainable positive financial performance from its existing operations and enable management focus on businesses that align with its strategy.

“In reviewing UPDC, the board weighed the long-term opportunities in the Nigerian real estate sector against the fundamental differences between the cashflow profile and capital needs of UPDC versus other entities in UAC’s portfolio. Following its review, the board concluded that it would be in the best interest of respective stakeholders of UACN and UPDC if UACN’s equity interest in UPDC is ‘unbundled’ such that UACN no longer holds any shares in UPDC and UPDC operates as a standalone legal entity, free to source appropriately structured capital,” the company said.