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9Mobile: NCC Conducts Fresh due Diligence on Preferred Bidder

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  • 9Mobile: NCC Conducts Fresh due Diligence on Preferred Bidder

The Nigerian Communications Commission says it is conducting another round of due diligence on the preferred bidder for 9Mobile, Teleology Holdings Limited.

The due diligence will determine whether the bid winner has the technical capacity as well as the financial resources to successfully run the beleaguered telecommunications company.

Answering a question from journalists on the lingering takeover of the telecommunications company in Abuja on Wednesday, the Executive Vice Chairman, NCC, Prof Umar Danbatta, said the commission would soon report to its board on the result of the due diligence.

He added that the preferred bidder must fulfil all necessary conditions before it would be allowed to take over the company formally known as Etisalat.

Danbatta said, “There are issues but let me say we are almost done with sorting out those issues. We are presently conducting another round of due diligence on Teleology: to examine and consequently determine whether they really have the technical wherewithal to run the company effectively; and whether they really have financial capability to run well and so on.”

The NCC helmsman in April told journalists that Teleology had made the initial payment of $50m for 9Mobile, adding that the preferred bidder had less than 90 days to pay the remaining 90 per cent or $450m.

According to Danbatta, failure by Teleology to pay the remaining $450m on schedule would make it to lose the spot to the reserved bidder, Smile Communications.

The NCC boss said that as soon the technical team of the NCC was done with the latest round of due diligence, the recommendations would be sent to the board, which is in a position to give its consent for possible takeover of 9Mobile.

Speaking on MTN Nigeria Communications Limited, the NCC boss said the company was under obligation to list on the Nigerian Stock Exchange by May 2019, in accordance with the settlement it sealed with the operator in 2015.

He also expressed confidence on the capacity of the Nigerian telecommunications industry to keep deepening the nation’s broadband penetration.

Danbatta said, “There is more to achieving the maximum target of 30 per cent broadband penetration by 2018 ending. But let me say without fear of contradiction that we have so far surpassed the minimum target of penetration.

“We are presently at 22 per cent, according to the International Telecommunications Union, and we are doing everything within our power to make the penetration more ubiquitous.”

The NCC boss said the N23bn subsidy already approved in the NCC 2018 budget would make it possible for the infrastructure companies to roll out and increase the nation’s broadband penetration.

He added, “Until there is complete fibre connection across the country, we can’t have 30 per cent penetration.”

Danbatta also disclosed that the regulatory agency was working with the office of the Vice President, Prof Yemi Osinbajo, to oversee the laying of 18,000 km fibre infrastructure across the country.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Gold

Gold Steadies After Initial Gains on Reports of Israel’s Strikes in Iran

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Gold, often viewed as a haven during times of geopolitical uncertainty, exhibited a characteristic surge in response to reports of Israel’s alleged strikes in Iran, only to stabilize later as tensions simmered.

The yellow metal’s initial rally came on the heels of escalating tensions in the Middle East, with concerns mounting over a potential wider conflict.

Spot gold soared as much as 1.6% in early trading as news circulated regarding Israel’s purported strikes on targets in Iran.

This surge, reaching a high of $2,400 a ton, reflected the nervousness pervading global markets amidst the saber-rattling between the two nations.

However, as the day progressed, media reports from both countries appeared to downplay the impact and severity of the alleged strikes, contributing to a moderation in gold’s gains.

Analysts noted that while the initial spike was fueled by fears of heightened conflict, subsequent assessments suggesting a less severe outcome helped calm investor nerves, leading to a stabilization in gold prices.

Traders had been bracing for a potential Israeli response following Iran’s missile and drone attack over the weekend, raising concerns about a retaliatory spiral between the two adversaries.

Reports of an explosion in Iran’s central city of Isfahan further added to the atmosphere of uncertainty, prompting flight suspensions and exacerbating market jitters.

In addition to geopolitical tensions, gold’s rally in recent months has been underpinned by other factors, including expectations of US interest rate cuts, sustained central bank buying, and robust consumer demand, particularly in China.

Despite the initial surge followed by stabilization, gold remains sensitive to developments in the Middle East and broader geopolitical dynamics.

Investors continue to monitor the situation closely for any signs of escalation or de-escalation, recognizing gold’s role as a traditional safe haven in times of uncertainty.

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Commodities

Global Cocoa Prices Surge to Record Levels, Processing Remains Steady

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Cocoa futures in New York have reached a historic pinnacle with the most-active contract hitting an all-time high of $11,578 a metric ton in early trading on Friday.

This surge comes amidst a backdrop of challenges in the cocoa industry, including supply chain disruptions, adverse weather conditions, and rising production costs.

Despite these hurdles, the pace of processing in chocolate factories has remained constant, providing a glimmer of hope for chocolate lovers worldwide.

Data released after market close on Thursday revealed that cocoa processing, known as “grinds,” was up in North America during the first quarter, appreciating by 4% compared to the same period last year.

Meanwhile, processing in Europe only saw a modest decline of about 2%, and Asia experienced a slight decrease.

These processing figures are particularly noteworthy given the current landscape of cocoa prices. Since the beginning of 2024, cocoa futures have more than doubled, reflecting the immense pressure on the cocoa market.

Yet, despite these soaring prices, chocolate manufacturers have managed to maintain their production levels, indicating resilience in the face of adversity.

The surge in cocoa prices can be attributed to a variety of factors, including supply shortages caused by adverse weather conditions in key cocoa-producing regions such as West Africa.

Also, rising demand for chocolate products, particularly premium and artisanal varieties, has contributed to the upward pressure on prices.

While the spike in cocoa prices presents challenges for chocolate manufacturers and consumers alike, industry experts remain cautiously optimistic about the resilience of the cocoa market.

Despite the record-breaking prices, the steady pace of cocoa processing suggests that chocolate lovers can still expect to indulge in their favorite treats, albeit at a higher cost.

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Crude Oil

Dangote Refinery Leverages Cheaper US Oil Imports to Boost Production

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The Dangote Petroleum Refinery is capitalizing on the availability of cheaper oil imports from the United States.

Recent reports indicate that the refinery with a capacity of 650,000 barrels per day has begun leveraging US-grade oil to power its operations in Nigeria.

According to insights from industry analysts, the refinery has commenced shipping various products, including jet fuel, gasoil, and naphtha, as it gradually ramps up its production capacity.

The utilization of US oil imports, particularly the WTI Midland grade, has provided Dangote Refinery with a cost-effective solution for its feedstock requirements.

Experts anticipate that the refinery’s gasoline-focused units, expected to come online in the summer months will further bolster its influence in the Atlantic Basin gasoline markets.

Alan Gelder, Vice President of Refining, Chemicals, and Oil Markets at Wood Mackenzie, noted that Dangote’s entry into the gasoline market is poised to reshape the West African gasoline supply dynamics.

Despite operating at approximately half its nameplate capacity, Dangote Refinery’s impact on regional fuel markets is already being felt. The refinery’s recent announcement of a reduction in diesel prices from N1,200/litre to N1,000/litre has generated excitement within Nigeria’s downstream oil sector.

This move is expected to positively affect various sectors of the economy and contribute to reducing the country’s high inflation rate.

Furthermore, the refinery’s utilization of US oil imports shows its commitment to exploring cost-effective solutions while striving to meet Nigeria’s domestic fuel demand. As the refinery continues to optimize its production processes, it is poised to play a pivotal role in Nigeria’s energy landscape and contribute to the country’s quest for self-sufficiency in refined petroleum products.

Moreover, the Nigerian government’s recent directive to compel oil producers to prioritize domestic refineries for crude supply aligns with Dangote Refinery’s objectives of reducing reliance on imported refined products.

With the flexibility to purchase crude using either the local currency or the US dollar, the refinery is well-positioned to capitalize on these policy reforms and further enhance its operational efficiency.

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