THE board of directors of Oando Plc has approved rights issue of 301,694,876 ordinary shares of 50 kobo each at N70 per share.

The offer, valued at N20 billion and on the basis of one new ordinary share for every three ordinary shares of 50 kobo each, has been scheduled to open on January 25 and close on February 19, 2009.

Chairman of the company, Major General Mohammed Magoro (rtd), explained in Lagos yesterday, that the rights issue is a first step towards raising fund for Oando's long-term expansion agenda, adding that all necessary arrangements regarding the rights issue have been made.

Magoro said the requisite approvals have been received from the Securities and Exchange Commission (SEC), the Nigeria Stock Exchange (NSE) and the Johannesburg Stock Exchange (JSE) for the registration and the listing of the shares being offered.

He explained that shares being offered will rank pari passu in all respects with the existing share capital of the company.

Shareholders had in July 2009, during the company's yearly general meeting, authorised plans by the company's board of directors to raise N200 billion to boost the oil and gas outfit's operations.

The fund is expected to boost Oando's ongoing expansion of its operations in the oil and gas sector of the Nigerian economy.

Specifically, the fund is also expected to strengthen supplies of Premium Motor Spirit (PMS), Automotive Gas Oil (AG0), coupled with Oando's plans to expand market share by "aggressively increasing" its customer base in Nigeria and West Africa sub region.

Gaslink Nigeria Limited, Akute Power Limited, East Horizon Gas Company Limited (EHGC) and other gas and power Special Purpose Vehicles (SPVs), are among the companies expected to benefit.

Chief Executive Officer of Oando Plc, Jubril Adewale Tinubu, also disclosed yesterday that plans are in top gear to raise much larger international equities in the first quarter while N75billion would be raise in April inline with the expansion agenda.

He added that the company would sustain its growth momentum, while at the same time meeting the expectation of its numerous customers and shareholders.

Speaking recently at Oando's yearly general meeting, Tinubu said he has experienced further growth in all aspects and lines of its business, adding that the company has been able to further strengthen its position as an integrated service provider.

"The year experienced the first dividends of our diversification from the downstream to the mid and upstream sectors of the oil industry.

"Our upstream division contributed significantly to our earnings and profitability as we grew the group's net profit from N5.48 billion in 2007 to N8.34 billion in 2008.

"This remarkable result is attributed to the company's improved operational efficiency and increased trade volumes. We also embarked on a number of programmes to ensure our success and future domination of the Nigerian oil industry."

Based on the performance, shareholders are entitled to N6.00, which represents interim and final dividend.

The Guardian Newspapers, Tuesday January 19, 2010.