Dialectic Africa Analyst

Dear Africa Interested Individuals:                                                         In 2006, Cadbury Schweppes UK increased its stake in Cadbury Nigeria from 46% to 50.04% giving the parent majority control.  By December 2006 a grievous accounting scandal broke that led to the removal of top management of Nigerian origin and the restatement of earnings going back three years.  The increase in stake took place in the same year of the accounting scandal.  Less than three years later in 2009, the parent increased its stake to 75%.  Unilever UK earlier in 2015 successfully increased its stake in Unilever Nigeria from 53.4% to 75%.  Unilever Nigeria is struggling and has been struggling since 2011 from my own vantage point.  The best analogy I can give here is when a baby's cry becomes a shrill .  Many people are talking about Unilever Nigeria's struggles now because it is more than obvious.  Another multinational sought an increased stake when the going got rough an

Dear Africa Interested Individuals:                                                         Happy Hump Day!  Let us get to it.  As African countries seek more listings on their respective stock exchanges, I decided to look at developments and strategies deployed to achieve more listings.   First Rand Bank is the third largest bank in South Africa and has listed subsidiaries in Namibia and Botswana.  First Rand Bank has contributed to the increased listing of companies on African Stock Exchanges.  Rand Merchant Bank has been operating in Nigeria for over four years.  Will they ever list?   Barclays Africa (Absa) is the second largest bank in South Africa and has listed subsidiaries in Botswana and Kenya.  Barclays Africa has applied for a merchant banking license from the Central Bank of Nigeria.   Illovo Sugar South Africa owns Zambia Sugar Company (ZSC) and ZSC is listed on the Lusaka Stock Exchange and the Johannesburg Stock Exchange.     Societe Generale is a pop

Dear Africa Interested Individuals:                                                           I am going to give a rundown of some of my major policy opinions with insights on certain matters and decisions taken by policy makers thus far.  All these insights are contained in one or more of my 64 articles (and counting) on this blog. 1. I said that Nigeria should do crude oil swaps (total overhaul of the existing system) in exchange for imported petroleum products.  This will save foreign exchange that is dwindling in supply given the steep drop in crude oil prices over the past twelve months.  Nigeria is aggressively working on this as we speak.  The Nigerian oil company also wants to be the major importer of gasoline into the country to reduce subsidy fraud by diverse downstream oil marketers.  Foreign reserves have been on a consistent increase over the past three month and counting as leakages are being plugged.    2.  I said that the fuel subsidy should not be removed n

Dear Africa Interested Individuals:                                                            Stanbic IBTC about four months ago made known its intention to raise fresh equity in the amount of $102m (N20.4B) from its existing shareholders (the way Nigerian banks blaze through capital should be a case study for Harvard & Darden Business Schools - the two largest producers of business school case studies worldwide) at a price of N25.50 per share later in 2015.  About two months after expressing its intention, Stanbic IBTC releases its H1 2015 earnings and tells the world its profit attributable to shareholders has declined 46% year-on-year for the first six months of 2015 after rising by 57% from FY 2013 - 2014. The result was released (in record time) within the first week after the end of the reporting period on June 30th, 2015.  What does a bank that wants its shareholders to grant it fresh equity in the amount of $102m do?  It gives out $45m (N0.90 per share) in the for

Dear Africa Interested Individuals:                                                         This is based on the performance of the nineteen (19) banks reviewed as at June 30th, 2015.  Standard Bank and ETI were excluded due to a particular line item not being disclosed.  Half-year basic earnings per share was annualized for all banks.  Prices used were today.  Figures used were as published by the bank whether audited or unaudited.  All banks have a December fiscal year-end.  This value-discovery approach is self-created .  I will give you a straight ranking and then provide my best picks in each country.     Best Value 1. Ghana Commercial Bank 2. CAL Bank Ghana 3. Credit Agricole Egypt 4.  Ecobank Ghana 5. Access Bank Nigeria 6. UBA Nigeria 7. GT Bank Nigeria 8. Barclays Kenya 9. Zenith Bank Nigeria 10. First Bank Nigeria 11. KCB Group Kenya 12. CBZ Holdings Zimbabwe 13.   Equity Group Kenya 14. SCB Ghana 15. Comm.

Dear Africa Interested Individuals:                                                          A country is not a person; a country is made up of people.  A country gets its identity from its people.  While people are referred to as human capital by companies, I consider people as human identity by countries.  So, how are multinational companies rating Nigerian and Ghanaian C-level executives presently?  Recent developments are ominous for Nigerian executives and those in the pipeline and blossoming for Ghanaians executives and bodes well for those in the pipeline. Diageo appointed its first Nigerian CEO for Guinness Nigeria in 2012 (appointment took effect July 1st, 2012) since the appointment of Ralph Alabi in 1991.  He was prior to that the CEO of East African Breweries Kenya and before that Guinness Ghana.  He was removed from the position of CEO of Guinness Nigeria in October 2014 after a brief tenure that was deemed unsatisfactory.  His current professional whereabout is

Dear Africa Interested Individuals:                                                         The clamor continues for commodities export dependent (especially oil) economies to further devalue their currencies.  I keep asking myself "when is enough finally enough?"  The clamor is largely driven by global economists across the spectrum loyal to economic theory and the countries they are domiciled in, portfolio managers and large commercial banks in the countries of focus with net positive (more dollar inflows expected than dollar outflows) dollar exposures.   What does devaluation do to the people in the countries that have devalued their currencies multiple times (or one devaluation of 20% or more) over a short period? 1. Inflation rises quickly and is driven by those directly and indirectly impacted which is everybody .   2. Chances are high that the Central Bank (Fed in the USA) will have to raise interest rates to stem inflationary pressures in the economy. T