(Adds details, share price, background)
By Oludare Mayowa
LAGOS, Nov 16 (Reuters) - Nigeria's Oando Plc OANDO.LG
plans to seek shareholder approval next month to raise up to 80
billion naira ($402 million) through a rights issue and to spin
off power and gas subsidiaries, the energy firm said on Monday.
Oando has been hard hit by the fall in oil prices since
mid-2014, just as it paid $1.5 billion to acquire the Nigerian
unit of the U.S. firm ConocoPhillips (N:COP), part of which it
funded through debt.
In addition to the rights issue of up to 80 billion naira,
the company will also seek approval on Dec. 7 to issue 40
billion naira of shares from its unissued share capital to swap
debt for equity under agreements it has with two shareholders,
Ocean and Oil Development Partners and QPR Limited, it said.
The company, which is listed in Johannesburg and
Toronto OER.TO as well as in Lagos, is also seeking
shareholder approval to sell its gas and power investments.
Last week the energy firm repaid a $100 million loan owed to
African Export-Import Bank, part of which was taken to fund the
Conoco acquisition. It reported net debt of $1.77 billion as of
the nine months to September, down from $2.41 billion in 2014.
Oando agreed in June to sell 60 percent stake in its
downstream business to Vitol and Soros-backed Helios
Investment Partners for $276 million.
Shares in the oil company are down 52 percent so far this
year after falling 34 percent last year, giving it a market
value of 92.63 billion naira ($466 million). The company shed
0.13 percent to 7.70 naira at 1200 GMT.
The energy company last week posted a $246 million loss in
the nine months to September after reporting a record loss of
$1.10 billion for the full year 2014.
The stock exchange said last week it was "greatly concerned"
about the losses at Oando and was reviewing the situation.
The Conoco acquisition was aimed at helping Oando change
from being a marketer of refined petroleum products into an oil
and gas explorer. But high financing costs coupled with the
plunge in oil prices have hit profits, despite an increase in
production volumes, analysts say.
($1 = 198.95 naira)
(Additional reporting and writing by Chijioke Ohuocha; editing
by Adrian Croft)