Press Release

Chellarams, Ekiti State Bons list on NSE – Business Day

Written by Balendran MidhushaanMarch 22, 2012
Chellarams, Ekiti State Bons list on NSE – Business Day 

Date: March 22, 2012

The Chellarams Plc’s N540 million unsecured floating rate bond 2019 of N1,000 each at par series 2 under the N5 billion medium term note programme was admitted on the daily official list of the Nigerian Stock Exchange (NSE) on Friday, March 16, 2012.

The coupon rate is Monetary Policy rate (MPR) + 5 (minimum 13 percent, maximum 19 percent). Since MPR is currently 12 percent, then the coupon  rate is 17 percent, which is paid semiannually – February 17 and August 17 each year – commencing August 17, 2012. The maturity date is February 17, 2019.

By this action, the number of listed corporate bonds and securities stand at 17 and 258, respectively.

In the same vein, the N20 billion Ekiti State government Fixed Rate infrastructure Development Bond (December 8) 2018 of NI 000 each at par under the N25 billion debt issuance programme, was admitted on the daily official list of the NSE on Tuesday, March 13, 2012.

The coupon rate is 14.5 percent. By this action, the number of listed state government bonds now stands at 12.

Nigerian quoted companies and corporate organizations raised N87 billion worth of bonds in 2011, according to data from the NSE. The Nigerian bond market closed 2011, according to data from the NSE. The Nigerian bond market closed 2011 generally trading at a deep discount to par value.

According to analysts at Meristem Scurities, current bond yields offer attractive real returns on a risk adjusted basis, with overall modified duration estimated at 3.1.

They note that if interest rates fall from current levels, 2012 presents an opportunity to lengthen portfolio duration using longer dated bonds with duration in excess of 3,11, in place of shorter duration instruments.

In our opinion, there is significant potential for capital gains on bonds in 2012, but since a substantial portion of the market’s holdings are in held-to-maturity’ portfolios, rates ill need to drop precipitously before profits are taken, they added.

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Press Release

Chellarams Plc Issues 540M Series-2 Bond Under N5bn Medium Term Note Programme – Business Day

Written by Balendran MidhushaanFebruary 20, 2012
Chellarams Plc Issues 540M Series-2 Bond Under N5bn Medium Term Note Programme – Business Day      

Date: February 20, 2012

Chellarams plc last Thursday February 16, 2012 issued a N540 million bond. The bond which was approved by the Securities and Exchange Commission (SEC), is the series 2 senior unsecured floating Rate bonds under the N5billion Chellarams Plc Medium Term Note Progamme.

The issuer (Chellarams plc) was incorporated as a private limited company on 13thAugust 1947. The conglomerate was listed on the Nigerian Stock Exchange as a public company on November 29, 1990.

Documents made available to Business Ay at the available to Business day at the completion board meeting held in Lagos n Thursday February 12, 2012 in respect of the offer for subscription show that the issue is the Series-2 N540million (MPR + 5percent) Senior Unsecured floating rate Bond due February 17, 2019 with an issue price of N1,000 per unit. The Series 2 bond, was assigned a BBB- and BBB rating from Global Credit Rating and DataPro Limited respectively. This is the second bond issued under the N5billion Chellarams Plc Medium Term Note Programme.

the principal activities of Chellarams Plc and its subsidiaries comprise of distribution, trading, assembling of motorcycles and bicycles; manufacturing of bakery product packaging materials, chemical supplies, retail clothing, electronics, packaging of milk products and other dairy products. Sonnie Ayere, managing director/ chief executive officer, Dunn Loren Merrifield, the Issuing House/Book Runner said: “This Bond issuance is a reflection of the appeal of the corporate Bonds market. Furthermore, the rich history of the Chellarams Plc spanning over 60 years in Nigeria 1 issue contributed I no small measure to the Series 2 bond issuance.”

Speaking further, Ayere said that the proceeds of the bond will be applied towards replacing infrastructure investment in associated companies (Dynamic industries and Woolworths Retails Stores).

Woolworths Retails Store is 50:50 joint venture with Woolworth South Africa, while 55:56 percent of the issue will be to refinance maturing debt obligations to reduce the company’s interest burden.

Besides helping the nation’s capital market become more balanced corporate bonds help companies diversify their option for sourcing much needed funds, Ayere added.

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Press Release

Chellarams, Woolworths Float N700m Firm

Written by Balendran MidhushaanOctober 19, 2011
Chellarams, Woolworths Float N700m Firm             

Date: October 19, 2011

One of Nigeria’s long standing conglomerated listed on the Nigerian Stock Exchange (NSE), Chellararns Plc, has signed a joint ‘ business partnership with Woolworths of South Africa to establish Woolworths Retail Stores Nigeria Limited.

Both firms would be injecting N 700 million into the Nigerian economy through the Nigerian economy through the new company that will begin with three stores in December. The three stores would be located in Palms Shopping ‘Mall, Victoria, Ikeja City Mall, Lagos and Polo Park Shopping Mall. Enugu respectively.

Woolworth is a South Africa with large chains of retail stores and has 350 stores and turnover of $4. billion.

On the other hand, Chellarams, which was established in Nigeria in 1923. is a diversified organization with operations in wholesales  & distribution, manufacturing. engineering, tourism, quick-service restaurants and power generation.

The joint venture was consummated last week with the signing of the memorandum of understanding in Lagos.

Speaking about the deal. the Woolworths Divisional Executive, International, Mr. John Fraser and Group Managing Director of Chellarams Mr. Suresh Chellarams, expressed confidence in-the joint venture.

“Our joint venture means we can deliver to customers the best retail offering 1 tailored to local market needs. Our partners bring knowledge of local trading conditions and we bring the quality, value, innovation and fashion our South Africa customer know and appreciate. It is the best of both worlds, Fraser said.

He added that the company was confident of its investment in Nigeria and were very pleased with the growth prospects of the Nigerian market.

The country  has a large population with significant and growing middle-and-upper income groups. We have found the right partner in Chellarams to grow the Woolworth brand in Nigeria.” he stated.

According to him. joint ventures with local partners, such as Chellarams were the new business model for Woolworths expansion  plans in other African countries “We have moved away from the franchise model we had in some African countries. It is not only a better profit model for Woolworths, but it is also better for customers,” Fraser said.

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Press Release

Chellarams, Woolworths Seal Joint Partnership Deal In Nigeria – The Punch

Written by Balendran MidhushaanOctober 14, 2011
Chellarams, Woolworthsm Seal Joint Partnership Deal In Nigeria – The Punch     

 Date: October 14, 2011

Chellarams Plc and the South African firm, Woolworkths, have entered into a joint venture partnership.

A statement by Chellarams on Thursday said the partnership, which resulted in the establishment of Woolworths Retails Stores Nigeria Limited was consummated  Lagos recently with the signing of the Memorandum of Understanding and other necessary documents.

Following the partnership seven additional stores would be established under the auspices of Woolworths Retails Store.

The statement said. Woolworths Retail Stores Nigeria Limited is set to commence business in Nigeria with the planned opening of three stores in Nigeria n December 2011. in addition, and as a futurism agenda, seven more stores would be added to its chin of stores would be added to its chain of  stores in the next three years; making a total of 10. the first three stores will be located in the Victoria Island. Ikeja and Enugu.

It quoted Woolworths divisional Executive (International), Mr John Fraser, and the Group Managing Director of Chellarams Mr Suresh Chellarams as expressing confidence in the joint venture investment between the two firms in Nigeria.

The statement added, this confidence stems from the fact that Nigeria has a large population with growing middle class and upper income groups, as well as the development of retail shopping centers.

Fraser, on his part, was quote as saying. Our joint venture means we can deliver to customers the best retail offering possible tailored to local market needs. Our partners bring knowledge of local trading conditions and we bring the quality, value innovation and fashion our South African customer know and appreciate. It’s the best of both worlds

Fraser added tat Woolworths has refined and improved its merchandise offing for customers in selected African countries. The statement lo described Woolworths as one of the largest chains of retail stores in South Africa with over 350 stores and a turnover $4bn.

Woolworths South Africa. Which opened for business in 19312 is affiliated with marks and Spencer of united kingdom.

The statement further aid. I aims to open a further 16 stores in African countries this year taking the total number of stores to 60 in the current financial year. It currently operates stores in the following 10 African countries: Botswana Namibia Lesotho. Swaziland. Ghana. Kenya. Tanzania, Uganda, Zambia and Mozambique.

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