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GCR Places Dufil Prima Foods Plc’s National Scale Issuer Ratings on “Review Extension”

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Dufil Prima Foods - Investors King

GCR Ratings (“GCR”) has placed Dufil Prima Foods Plc’s long-term and short-term national scale Issuer ratings of A-(NG) / A2(NG) respectively on ‘Review Extension’. Concurrently, the national scale long term Issue rating of A-(NG) accorded to the N10bn Series 1 bond has also been placed on ‘Review Extension’. The ratings process is ongoing and GCR expects to publicly release the updated rating result on or before 31 July 2021.

The ratings assigned in the last review are still in effect and remain unchanged until the review process is completed.

Related Criteria and Research

Criteria for the GCR Ratings Framework, May 2019
GCR Nigeria Country Risk Score report, published February 2021
GCR Nigeria Sector Risk Score, published February 2021
Criteria for Rating Corporate Entities, May 2019
Dufil Prima Foods rating report 2016-2020

Ratings History

Dufil Prima Foods Plc

Rating class Review Rating scale Rating Outlook/Watch Date
Long Term Issuer Initial National A-(NG) Stable Outlook June 2016
Short Term Issuer Initial A2(NG)
N10bn Series1 Bond LT Issue Initial National A-(NG) Positive October 2017
Long Term Issuer Last National A-(NG) Stable Outlook August 2020
Short Term Issuer Last A2(NG)
N10bn Series1 Bond LT Issue Last A-(NG)

SALIENT POINTS OF ACCORDED RATING

GCR affirms that a.) no part of the ratings process was influenced by any other business activities of the credit rating agency; b.) the rating was based solely on the merits of the rated entity, security or financial instrument being rated; and c.) such rating was an independent evaluation of the risks and merits of the rated entity, security or financial instrument.

The credit rating has been disclosed to the rated entity. The rating above was solicited by, or on behalf of, the rated entity, and therefore, GCR has been compensated for the provision of the rating.

The rated entity participated in the rating process via teleconferences and other written correspondence.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Merger and Acquisition

MainOne to be Acquired by America’s Equinix in a $320m Deal

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MainOne - Investors King

Nigerian and West African data centre and cable service provider, MainOne is close to being acquired by an American internet company in a deal that is touted to have a value of $320 million.

In a release by Equinix, the $320 million deal is expected to be sealed and signed in the first quarter of 2022, pending the satisfaction of conventional closing conditions, including the required regulatory approvals.

A Public Relations personnel from MainOne confirmed the deal, but stated that he had access to limited information. He was however convinced that the deal would be a total buyout.

MainOne was founded in 2010 by Funke Opeke, a Nigerian. The company has over 1,000 kilometres of reliable terrestrial fibre networks across the southern region of the country, while also owning and operating a subsea network from Nigeria to Portugal (in Europe).

The company also has digital infrastructure assets including three data centres (which are operational) across the western area of Africa. It also has another facility under construction, which is set for a launch in Q1 2022. These facilities have helped the company enable connectivity for Nigeria’s business community.

Equinix, on this background believes that MainOne is one of the most thrilling tech businesses to come out of Africa. Charles Meyers, the CEO and President of Equinix which has its headquarters in California, stated that the acquisition of MainOne would be the first step in the company’s strategy to become a leading African carrier neutral digital infrastructure company in the long term.

Meyers said that MainOne’s leading position in interconnection and its experienced management team are critical assets in Equinix’s bid to become the leading neutral provider of digital infrastructure across Africa.

Meyers noted that the growth in data consumption in Africa is one of the fastest in the whole world, and MainOne’s infrastructure, customer relationships and operating capability will extend Equinix’s reach and boost opportunities for customers based in Africa and other parts of the world.

It was agreed in the deal that all members of the MainOne management team, including the CEO will continue in their respective roles. Equinix will also take on MainOne’s about 500 employees, but it is unclear what will happen to them under the new dispensation.

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Company News

Former Dangote Group Truck Driver Sues Company over Injuries Sustained in Accident

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Dangote Cement - Investors King

A truck driver who worked with Dangote Cement, Anas Ibrahim has filed a lawsuit against the company for abandoning him and sacking him after he had sustained serious injuries in an accident that occurred while he was on duty.

Ibrahim was involved in an accident on July 1, 2020 while travelling along the Lagos-Abeokuta expressway when a vehicle ran into the Dangote truck he was driving after he offloaded bags of cement at the company’s depot.

Initially, he was taken to the Sango Otta General Hospital in Ogun state after he lost consciousness. After that, he was transferred to the Federal Medical Centre, Abeokuta before he was finally taken to the Mohammed Sunusi Specialist Hospital, Kano where he currently is.

The accident victim stated that he had suffered three broken ribs and had a complex fracture in his limbs, according to FIJ.

Ibrahim, through his lawyer dragged Dangote Cement to the National Industrial Court of Nigeria based in Kano. The complainant told the court that the company had neglected him and also refused to pay his medical bills after they terminated his employment.

Ibrahim sought an order of the court, which would require Dangote to pay him N50 million as compensation, N10 million exemplary damages and N1 million in legal fees.

The Dangote Group Spokesperson, Anthony Chiejina said to the FIJ that he was unable to comment on Ibrahim’s situation because he was still in mourning of Sani Dangote, brother to Aliko Dangote and the Vice President of the company.

Chiejina then said it was unfair for the newspapers to report the sacking and neglect of the truck driver who sustained serious injuries in the line of duty at a time when the company was in mourning. He went ahead to claim that truck drivers working for the company cannot be trusted all the time, although he failed to react to the situation.

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Business

Google, Meta Dominate as Advertising Industry Set to Exceed Growth Expectations

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Lagos Nigeria - Investors King

The advertising industry is expected to exceed growth expectations for 2021 as more brands turn to the search engine and social media platforms to get across to their customers during this pandemic, according to two advertising industry forecasts released on Monday.

In spite of the fact that the year was marked by supply chain disturbances across the globe which delayed products from reaching shelves and a user privacy crackdown by Apple Inc that caused many to fear that mobile advertising would be disrupted, brands have gone on to advertise online.

According to Jonathan Barnard, the Director of Global Intelligence at advertising firm Zenith, in-store shopping has still been slow because of the pandemic. Zenith was one of those who published an ad expenditure forecast on Monday.

The new businesses that were formed in the thick of the pandemic needed to advertise so that they would find customers, while other companies most likely maintained the ad spending in order to stay rooted in the minds of consumers, as said by Brian Wieser, the Global President of Business Intelligence at advertising agency GroupM.

The GroupM forecast predicts that global advertising spending will grow about 22.5% in 2021 compared to the previous year, while Zenith estimated a growth of 15.6%. Both estimates were updated from the previous expectations that were held.

The reports state that by 2022, advertising spending around the world is expected to increase by about 9%.

The growth has been beneficial for Alphabet Inc (Google), Meta and Amazon.com Inc, who are major sellers of digital ads and can now account for more than half of all the advertising spending occurring outside the walls of China. This represents an increase from about 40% back in 2019, according to GroupM.

The need for marketers to reach their customers directly has resulted in the success of retailers such as Walmart, Kroger and Target to quickly grow their ad sales businesses, allowing brands to target more customers using their shopper data.

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