PZ Cussons Nigeria PLC has announced that its Board of Directors, after careful deliberation, has decided to convert $34.26 million of its outstanding loan into equity.

In June 2022, PZ Cussons Holdings Limited (PZCH) loaned $40.26 million to PZ Cussons Nigeria PLC (PZCN) to help cover raw material and operational costs, which were difficult to manage due to currency shortages.

However, between 2023 and 2024, the Naira experienced significant devaluation, which negatively impacted PZCN’s financial results and led to a rise in its foreign currency-denominated loans.

In response to these challenges, the company’s board has decided to strengthen its balance sheet by settling the outstanding shareholder loan obligation and reducing exposure to foreign currency fluctuations.

According to a disclosure signed by Alsec Nominees Limited, the company secretary, and published on the NGX on February 15, 2025, the Board stated:

“After extensive discussions, we have agreed that converting a portion of the outstanding loan, amounting to USD 34.26 million, into equity is the most effective strategy to reduce debt and strengthen the Company’s balance sheet, while significantly minimizing the risk of future foreign exchange losses.” 

Post-Conversion, a remaining shareholder loan balance of $6 million will still be payable to PZCH.

Backstory 

In June 2022, PZCH provided a loan of USD 40.26 million to its subsidiary, PZCN, to help the company meet its foreign currency obligations for raw materials and operational expenses.

• However, after the foreign exchange market was liberalized in June 2023, the Naira experienced significant devaluation. This led to an unrealized exchange loss of N157.9 billion and a negative shareholders’ equity of N27.5 billion by May 31, 2024.

Despite these financial challenges, PZCN demonstrated revenue growth, achieving increases of 34% and 42% year-on-year for the full and half financial year periods ended 31 May 2024 and 30 November
2024 respectively.

• Nevertheless, the ongoing depreciation of the Naira continued to negatively affect profits, pushing net equity further into the red, reaching N34.5 billion as of the latest financial results on November 30, 2024.

In response to these difficulties, the Board is actively exploring strategic options to improve the financial health of the company.

• A significant proposal on the table is to convert USD 34.26 million of the outstanding loan into equity.
• This move aims to strengthen PZCN’s balance sheet while minimizing the dilution of minority shareholders.

The Plan 

The plan is to convert part of the outstanding shareholder loan of $34.26 million (N51,795,312,646.72) into equity at a price of N23.60 per share, effective February 12, 2025.

• This will create 2,194,716,637 new ordinary shares at a value of 50 kobo each for PZCH, increasing the company’s share capital by N1,097,358,318.50.
• These new shares will have the same rights as existing ones.

Shareholder approval is required, along with clearance from the Securities and Exchange Commission (SEC) for the conversion and registration of new shares on the Nigerian Exchange Limited.

The Board has approved these conversion terms after discussions with PZCH and recommends them for approval at an Extraordinary General Meeting on March 13, 2025, at Transcorp Hilton.

• After the conversion, PZCH’s ownership will grow from 73.27% to 82.79%.
• Other shareholders will see their stakes reduced: CardinalStone will drop from 4.91% to 3.16%, AMCON & PFA will fall from 1.56% to 1.01%, and other shareholders will decrease from 20.25% to 13.04%.

What to know 

• Shareholder loan terms will remain unchanged after conversion, as they are already favorable compared to current lending rates in Nigeria.
• The Board approved the conversion terms after discussions with PZCH and will recommend them for shareholder approval at an Extraordinary General Meeting on March 13, 2025.
• This conversion aims to strengthen the balance sheet, reduce foreign exchange risk, improve financial ratios, restore a positive net asset position, and enhance investor confidence and market value.

[Nairametrics]

The New Nigeria People’s Party (NNPP) has engaged in war of words with the Patriotic Volunteers, a group within the opposition All Progressives Congress (APC) in Kano state, over the announcement made by the APC group to form what it termed as “shadow government” to checkmate the administration of Governor Abba Kabir Yusuf.

In a statement issued as a counter to the group’s announcement, and signed by the state commissioner for Information Comrade Ibrahim Abdullahi Wayya, the state government described the group’s intention to form a shadow government in the state as not only a desperate and politically motivated scheme but also a dangerous move with serious social and legal implications for the entire state and Nigeria’s democratic system.

The commissioner said democracy does not permit anyone to lose their sense of judgment simply because they have lost relevance within their party’s political structure, adding that the right to freedom of expression does not grant anyone the liberty to make reckless statements or take actions that undermine constitutional governance and the sovereignty of an elected government.

“Let me remind these elements within the Kano APC that, in a democratic system like ours, forming a government within a government is entirely illegal and unconstitutional. A shadow government, as practiced in the United Kingdom, exists within a parliamentary system where opposition parties appoint “shadow ministers” to scrutinize the ruling government. However, Nigeria operates a presidential system, which neither recognizes nor supports such a structure outside the institutional framework of the law,” he said.

The group under the its national President of the group and former Secretary to the State Government (SSG), Alhaji Usman Alhaji, had revealed a plan to form a shadow government apparatus that will effectively put an eye on the state government’s activities..

According to him, the group is planning to assign its members to all the Ministries, Departments and Agencies (MDAs) to monitor their activities and make “constructive” criticism that would prompt the government to do the needful.

“This is what is obtainable in the UK where we see opposition parties form the shadow government to checkmate the incumbent one. We are going to replicate it in Kano by assigning our members at MDAs to monitor the activities there and come up with a report. We are committed to doing this, because what we want is a better Kano for all,” he said.

[DailyTrust]

In December 2024, President Tinubu presented a N49.7 trillion budget proposal to a joint session of the National Assembly.

However, on February 5, he notified the lawmakers of an additional N4.5 trillion to the budget figure, raising it to N54.9 trillion.

Out of the figure, N3, 645, 761, 358, 925 trillion is for statutory transfers; N14, 317, 142, 689, 548 trillion is for debt servicing; N13, 064, 009, 682, 673 trillion is for recurrent non-debt expenditure, while N23, 963, 251, 624, 250 trillion is for capital expenditure.

The National Assembly had equally set January 30, 2025, as the target date for the budget approval. But following the inability to conclude budget defence sessions, plenary resumption was postponed to February 4, 2025. The Chairman of the House Committee on Appropriations, Abubakar Bichi, acknowledged that the process was lengthy, involving budget defence, harmonisation and final report submission before final passage.

Surprisingly, on resumption after Christmas break, the President sent two separate letters to the two chambers of the National Assembly, where he proposed to raise the earlier budget from N49.7 trillion to N54.9 trillion, citing additional revenues generated by key government agencies as the rationale behind his action.

He was said to have conveyed the budget adjustment in separate letters to both the Senate and House of Representatives. The letter was read during plenary on the same day by the Senate President, Godswill Akpabio.

Tinubu said the increase was driven by N1.4 trillion in additional revenue from the Federal Inland Revenue Service, N1.2 trillion from the Nigeria Customs Service and N1.8 trillion generated by other government-owned agencies.

After reading the letter, the proposal was referred to the Senate Committee on Finance and Appropriations for urgent review, with Akpabio assuring that the budget deliberation would be concluded before the end of February.

As promised, the National Assembly worked expeditiously to beat the end of February deadline and just last week, February 13, 2025, the Senate passed the 2025 budget with a total figure of N54, 990, 165, 355, 306 trillion.

In his remarks after the passage of the bill, Senator Akpabio, who presided over the session, commended the Finance Committee Chairman, the standing committees chairmen and all members present for their contributions to its passage. He also expressed hope that the budget would be used to move Nigeria forward.

However, economic experts, manufacturers and analysts spoke to DAILY POST, with some describing it as purely academic exercise.

Those pushing this narrative wondered why the president would bring the additional revenue to the 2025 budget instead of putting it into the 2024 budget to ensure that it was 100 percent implemented.

There are those who have argued that it could lead to inflation if not well channeled.

President of the Calabar Chamber of Commerce and Industry (CALCCIMA), David Etim, stated that while budgets are merely projections, their realisation depends on the government’s ability to generate revenue to support them.

“The budget has increased by about N5 trillion. If that amount is directed toward infrastructure development, it will be a game-changer, bringing tangible value to the economy. However, if it is funneled into recurrent expenditures or consumption, it will only fuel inflation,” Etim told our correspondent.

He expressed optimism that the government’s stated goal of reducing inflation to around 24 percent, with a long-term target of 15 percent, suggests that the additional funds would be channeled into productive investments.

“If this money is used for infrastructure, it will boost economic productivity, create employment and help stabilise inflation further,” he added.

Etim also noted that manufacturers stand to gain significantly from improved infrastructure, particularly better road networks that will enhance market accessibility.

“With more roads opening up, access to markets will improve, increasing demand and income for manufacturers,” he explained.

Also, a small and medium enterprises expert and member of the Lagos Chamber of Commerce and Industry (LCCI), Daniel Dickson-Okezie harped on the need for strategic allocation of the additional budget.

He emphasised that the ratio of capital expenditure to recurrent expenditure remains low, insisting that the government must prioritise long-term investments over short-term spending.

“In most developed economies, budgets lean more towards capital projects rather than recurrent expenses. We need to adopt this approach now more than ever,” Dickson-Okezie said in an interview.

According to him, capital expenditure, particularly in infrastructure, will have a multiplier effect across various sectors, creating jobs, enhancing business operations, and improving the overall standard of living for Nigerians.

“It is not just about increasing the budget; it is about ensuring that the funds are channeled correctly. If this money is invested wisely, it will drive economic growth and create a lasting impact,” he concluded.

For a former House of Representatives member, Yusuf Mohammed, the proposal is basically academic, as he noted that whether it would generate inflation or boost the economy is neither here nor there.

He argued that since the President told Nigerians that he had gotten some additional revenues from 2024, he would have used the money to implement the 2024 budget instead of putting it into the 2025 budget.

He insisted that since the revenue agencies have improved and are generating more money, it means that the President can also do that projection for 2025 because the revenue generating agencies are bringing more money.

“All these arguments that there will be more inflation don’t add up at all. Several countries in the world like China, are going into serious implementation of infrastructural programmes to boost the economy but here it is not so. We tend to channel our resources into recurrent expenditures.

“The government needs to spend the money it has generated to get the country moving. Instead of keeping the money for 2025, the money should be used to implement all the infrastructural projects and programmes that are included in the 2024 budget.

“And if you do that, you will generate economic activities and more people will be taken off the street and the economy will get moving again. So, the question of whether it will bring inflation doesn’t add up,” he said.

Still pushing that the hike in 2025 budget was not necessary, he stressed that since the 2024 budget has not been implemented 100 percent, the money would have been deployed to ensure that the 2024 was fully implemented.

“The question that we need to ask ourselves is: what is the level of implementation of the 2024 budget? I don’t think it is 100 percent.

“At the last count, someone told me it was just 60 percent. So, if you have additional money, why don’t you implement the budget fully?

“This is because, according to the president, the budget is a plan to get the economy moving. Now you have not implemented the 2024 budget 100 percent and you are keeping the money for next year.

“I strongly believe that we have not fully implemented the 2024 budget and the president should just do that.

“Since we now know from his calculations that the agencies generating revenue will generate more revenue in the coming years, he should simply project that in the coming year, instead of an additional nine percent, he can project 20 or 30 percent and then review the budget accordingly.

“After all, we are expecting that the oil production will still further increase, meaning that there will be a lot of money that will be generated in the coming year.

“In my eight years in the National Assembly, I have discovered that several projects are not completed because of inflation and changes in costs and the rest of them.

“So we have a lot of projects that were started and may not have been completed and if the president had gone to the National Assembly to seek for extension of time for implementation of previous budget, my contention is that since 2025 budget is a plan that is being made and it is not being implemented immediately, if you have additional funds, it would be better applied to the projects that need to be funded but have not been funded.

“Secondly, a budget is a plan; an assumption of the revenue you will get and the expenditure that you are going to incur.

“That means that if the President is now convinced that the revenue agencies are capable of generating more revenues than they used to, and that there are now more people in the tax net than we had before, it means that there should be a change in the 2025 budget.

“And that change should be to tell the National Assembly that he expects more money in 2025, and then to increase the budget to implement all the programmes that he is planning to implement,” he stated.

He believes that the whole idea boils down to politics, stressing: “Like I said, the president and his team are very good at playing politics in the minds of the people and that is what they are doing, to show that they are transparent and that they are doing things that other people have not done before.

“But, my contention is that the National Assembly has always tinkered with revenue projections and made decisions based on its projections year in year out.”

With stakeholders emphasising the need for infrastructures focused spending, the government’s budget execution strategy will be crucial in determining whether the N5 trillion hike would serve as a catalyst for economic expansion or exacerbate inflationary pressures.

Expectations are also high with regards to how the entire budget performs, especially in bringing Nigerians out of misery.

[DailyPost]

Actress and producer Teniola Aladese has revealed how she struggled to come to terms with the tragedy of losing her ex-boyfriend.

In an interview on With Chude, Aladese revealed that her ex-boyfriend passed away just months after their breakup, leaving her with a deep sense of loss and anger towards God.

The actress, known for her role in The Christmas in Lagos, questioned God’s purpose behind her ex-boyfriend’s untimely death, citing his talent, plans and potential.

However, Aladese said she found solace in believing that her ex-boyfriend fulfilled his purpose during his time on earth, leaving a lasting impact on those who knew him.

She said: “He passed a couple of months after we broke up and was even dating someone else after we ended things. We still remained friends, but after he passed, it was a huge blow – on me, on his friends, on his family members. I don’t even want to know how his mum copes. He was the only son. One daughter, one son. 

“For me, it took a lot of reassurance that people come into this world for a certain purpose. Because the reason I was angry with God was that this guy had his whole life ahead of him. He was so talented, he was a writer. He had plans to direct and even after we broke up, he said to me, ‘You are still going to produce my films.’ And so there were all these plans, and just like that, accident and the guy goes. I am like, ‘Why would you allow this to happen?

“Now what I use to console myself is that he was here for a purpose. He left his mark. All of us that were his friends remember him for who he was and for how good of a person he was”.

[TheNation]