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Importation of “Tokunbo” Vehicle Dropped by 51% Amid Forex Scarcity, High Clearing Costs

Importation of foreign used cars popularly known as “tokumbo” has dropped by 51.2 percent in the first half of 2022.



vehicle registration

Owing to the scarcity of foreign exchange and high clearing cost at the seaport, data from the National Bureau of Statistics (NBS) shows that importation of foreign used cars popularly known as “tokumbo” has dropped by 51.2 percent in the first half of 2022. 

According to NBS, in the first half of 2022, Nigeria imported foreign used cars recorded a total worth of N169.1 billion which represents a heavy decline of 51.2 percent when compared to N346.2 billion recorded in the first half of 2022. 

While the drop in volume and monetary worth has been noticeable since the beginning of this year, Investors King understands that the acute foreign exchange scarcity and the high costs of clearing cars at the ports are some of the most potent reasons for the drop. 

A closer look at the NBC data shows that the drop which has led to an astronomical rise in the price of foreign used cars in Nigeria is the country’s lowest since 2018. 

Similar factors also affect the importation of motorcycles and tricycles resulting in the surging prices of both. 

Several observers and a number of industry players have lamented the high costs of clearing goods at the Nigerian port which has eroded their profit. 

A car dealer simply identified as Enitan noted that cars that could be cleared for N600,000 are now being cleared for more than a million naira. 

In addition, the introduction of Vehicle Identification Number (VIN) valuation by the Nigeria Customs Service in February 2022 has led to the surging increase of the tariff charged on imported cars both brand new and foreign used alike. 

It would be recalled that VIN valuation had generated some controversy which led to its initial suspension. 

VIN valuation when introduced was generation outrageous value of more than 200 percent on imported vehicles. 

Although the Nigeria custom stated that it has rectified the error, vehicle importers nevertheless argued that the valuation is still faulty and has made many of them shy away from importing used vehicles which has led to the drop in volume. 

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Merger and Acquisition

Otedola Moves to Sell Part of Geregu Power Plc to FEDA

Afreximbank to acquire part of Geregu Power plant



Geregu Power

Billionaire Femi Otedola-owned energy company, Geregu Power Plc is in talks with the Fund for Export Development in Africa (FEDA) for the acquisition of part of the energy company.

The company stated in a statement signed by Akinleye Olagbende, Company Secretary and made available on the Nigerian Exchange Limited (NGX).

Geregu Power hereby notifies “Nigerian Exchange Limited (the Exchange) and the investing public of its discussions with the Fund for Export Development in Africa (FEDA) for the acquisition of a portion of Geregu Power Plc shares. FEDA is the impact development arm of the Africa Export and Import Bank (Afreximbank),” the company stated.

According to the energy firm, talks are presently ongoing and “where these talks progress to a more advanced stage, the company will notify the Exchange and the investing public in line with the rules of the Exchange.”

In October, Geregu Power listed 2.5 billion shares at N100 a unit on the Main Board of the NGX. This puts the company’s market value at N250 billion and also in a better position it to raise capital to bid for Geregu II as it is presently doing.

Speaking on the listing, the Chairman, Board of Directors, Mr. Femi Otedola, CON, said “the listing of the company was the actualization of a vision to bring world-class standards in governance sustainability, and business processes to the Company and the Nigerian electricity sector.”

He added that “listing on the Main Board of the Exchange will ensure that the long-term growth of the company is assured and its benefits will be passed on to our esteemed shareholders”.

Otedola is the largest shareholder in FirstBank and also holds a 99% stake in Amperion Power, the owner of the Geregu Power Plant.

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Merger and Acquisition

Access Bank Acquires Indirect Stake in Sigma Pensions



Access bank

Access Holdings on Friday announced it has completed the acquisition of an indirect equity stake in Sigma and the merger of its subsidiary, First Guarantee Pension Limited (FGPL) with Sigma.

According to the bank, following the sanction of the Scheme of Merger between Sigma and FGPL by the Federal High Court on December 1, 2022, FGPL has been dissolved without winding up leaving Sigma as the surviving entity, according to Access Holdings.

Commenting on the transaction, Dr Herbert Wigwe, Group Chief Executive of the Corporation, said “Following the successful completion of the merger, our plan is to leverage the synergies of these entities, as well as the Corporation’s expansive distribution network, strong risk management culture and best-in-class governance standards to create a formidable pension funds administration business.”

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Company News

Dangote Group Dismisses Rumours of Plan to Rise Cement Price

Dangote Cement says no price increase



Africa’s leading cement producer, Dangote Cement Plc has dismissed the rumor that it plans to increase the price of its products.

The clarification became necessary following a recent publication that Dangote Cement plans a fresh increase.

Recently, there has been some publication (Not Investors King) about a potential increase in the price of cement. The publications noted that the increase will be a result of the high cost of fuel among other prevailing issues. 

According to the Senior Manager, branding and communication, Dangote Industries Limited, Mr Sunday Esan, “Dangote Cement is not embarking on a price increase”, stating that the increase is mere speculation.

Meanwhile, Dangote Cement in the third quarter of 2022, recorded an increase in the overall volume of cement sales by 6.2 percent to 20.8 metric tons in the third quarter of 2022.

According to the company’s Chief Executive Officer, Michel Puchercos, this was achieved, despite the elevated inflation caused by a very volatile global environment.

Similarly, while speaking on the increase in the price of fuel, Puchercos said “to mitigate the impact of the significant increase in energy and AGO costs, we are strengthening our efforts to ramp up the usage of alternative fuels”.

“We are on track to commission our Alternative Fuel feed system at Obajana lines I and V, and Ibese line II in November. In addition, we are ramping up our investment in Compressed Natural Gas (CNG), to reduce our AGO usage,” he added. 

Investors King understands that Dangote Cement is Africa’s leading cement producer with nearly 51.6Mta capacity across Africa. Although it has a few competitors which include BUA Cement, the company supplies most parts of Nigeria.

In addition, Dangote Cement has operations in 10 African countries. 

Its production plant in Obajana, Kogi state, is the largest in Africa with 16.25Mta of capacity across five lines while the Ibese plant in Ogun state has four cement lines with a combined installed capacity of 12Mta.

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