I read the article, subject above which was published on your platform on March 5, 2024, and would wish to correct a few wrong impressions created by the writer, who submitted his article through your publishing partners, reason his name was not mentioned.
First, this intervention appears prejudicially speculative, and this was evident in the first paragraph where the person of Tony Elumelu was described as “a publicity-loving titan,” a description that tended to suggest that the Transcorp Power project into which more than N90 billion had been spent was a mere publicity stunt. The absurd corollary between such a huge investment and a hunt for publicity by someone who has built a reputation globally for venture capitalism and philanthropy points to an intention to undermine the person of Tony Elumelu, rather than protect the smaller investors touted as perhaps the most important thesis point of the article.
To begin with, the professional integrity of the so-called experts and analysts quoted by this writer is highly questionable, and the next few paragraphs will prove this. In the 19th paragraph of this article, the writer quoted one Adeodun Dorcas, passed off by the writer as an energy reporter with Energy News Africa Plus, as suggesting that the listing of Transcorp Power on the Nigerian Exchange as happened on Monday, March 4, 2024, did not pass the transparency test.
But a search of who Adeodun Dorcas yielded conflicting results. A name search conducted on the Energy News Africa Plus portal did not yield any results. However, other random searches produced an Adeodun Adenike Dorcas, whose profile indicated her to be a writer for The Ghana Sentinel. This Dorcas was described as one who has interests in human capital management, writing, and strategic project management. No mention was made of Energy Reporting in her brief bio on The Ghana Sentinel website.
Surprised, but encouraged by this result, another search was conducted on the second interviewee, Rachael Alabi, said to be a reporter with The Nigerian Inquirer. The search unraveled a young lady bearing the name of Oluwatosin Racheal Alabi, who is apparently the owner of the blog.
This Rachael Alabi was described as an accomplished journalist, who “boasts of a pivotal year with Insight Links Media where she held the esteemed role of an international correspondent. Specializing in amplifying global stories, Oluwatosin stands out as a skilled writer and a vibrant, articulate speaker. Her unmatched zeal for journalism, combined with her audacious reporting style, distinguishes her in the realm of contemporary journalism. Advocating for truth and transparency, she continuously strives to bring unbiased and relevant narratives to the forefront.”
Nowhere in the profile that was probably written by herself was it mentioned that she is a financial analyst and thus qualified to give an opinion on such serious issues as stocks and securities. A financial analyst or investment analyst, according to www.indeed.com by its simplest definitions, is “a finance professional who helps companies make business decisions based on factors like market trends, the financial status of a company, and the predicted outcomes of a certain type of deal.”
It can therefore safely be said that the two names put forward in this article were either contrived or conveniently used in the thought that readers would not exercise the discretion to make inquiries about who they truly are.
Even if the names used by the writer weren’t fictitious, the alternative scenario which is akin to using carpenters to perform open heart surgery is more difficult to brook, especially given what many people across Africa assume that www.allafrica.com represents. How would anybody doing an honest analysis use charlatans to interpret a market as delicate as the securities market, if the intention was honest?
A summary of the allegations raised in the article are: that smaller investors were being disadvantaged, that Transcorp Power introduced only 40 million shares, and that the company has a questionable dividends history.
But these allegations are as wild as they are not supported by any evidence. On the day when the company was formally welcomed to the Nigerian Exchange, a throng of the company’s shareholders were present to witness what was historic for them as shareholders. Those who attended the event included both major and minor shareholders.
The matter of poor dividends history is also strange and fictitious. This is because there are laid out rules for payment of dividends to shareholders, and except the writer was accusing the body of the Nigerian Exchange of bias against minority shareholders, there is no basis for this allegation.
On why Transcorp Power floated only 40 million shares on the day of its first listing, simple research should have informed the writer that it is not the management that decides for the shareholders when to put their stocks for sale and at what volume. Transcorp Power complied 100% with the free float requirement on the day of listing. Even then, the shareholders on the same day, made additional shares available for the investing public to boost market liquidity, and as at the close of the trading the day after the listing, which was March 5, 2015, over 150 million units of shares were traded.
Having responded to these allegations, the rest of the article will attempt to address other issues.
Following the acquisition of the Ughelli Power plant by Transcorp, the expectation was that an investment outlay of N56.6 billion was required to ensure adequate functioning of the plant, but determined to look beyond the present and to play in associated areas such as the green energy ecosystem, Transcorp increased investments in the business to more than N83 billion investment as at May 2023. It is impossible to situate such a huge investment in publicity alone.
In the past five years, Transcorp Power has proven that efficient management of resources triggers profitability. For instance, the business has increased its revenue from N55.9 billion in 2019 to N142.1 billion. That is an increase of about 158 percent over five years. In a country challenged by power infrastructure, with constrained earning opportunities, any person who achieves this merely for publicity purposes should deserve his or her flowers.
It would seem that in putting together this article, the writer led with a populist headline, but decided to pursue a narrow elite interest. This is because, in more than a few paragraphs of this article, the writer appeared to be struggling to prop Nigeria’s respected billionaire businessman and promoter of the Geregu Power Plant Plc, Chief Femi Otedola, obviously suggesting some sort of rivalry between him and Tony Elumelu.
Let it be assumed that despite the perceived misunderstanding between the two over the exaggerated attempt to take over Transcorp Group by Otedola some months ago, the two businessmen are not in any form of competition as far as the power business is concerned. But it seems an attempt is being made to foment some form of phantom rivalry where none previously existed.
The power sector in Nigeria is not like the fast-moving consumer goods (FMCG) business, or even the financial services business where operators compete from shelf space to shelf space and customer to customer. In the power sector, every operator has an identifiable area of operation. The concern of the owners here is for each one to exploit the opportunities in his catchment by maximizing revenue opportunities and leveraging customer service and other creative ways of supply-side management to deliver value.
But unrelenting in the attempt to infuse a figment of competition in the rhetoric, the article in its third paragraph, turned the sacred research strategy of journalism on its head. Here, the writer admitted the article was inspired by “whispers” around the market, a fancy term that was used to edify reliance on either rumours or contrived data. The paragraph below will help justify this position:
“Intriguingly, whispers within authoritative business circles in Nigeria suggest that Elumelu's decision to list Transcorp Power might also be inspired by the strategic playbook of billionaire businessman Femi Otedola, an activist investor whose company, Geregu Power Plc, has in recent years cemented its position as the country’s top energy supplier. Otedola's reaffirmation as a Forbes-listed billionaire earlier this year has not gone unnoticed by Elumelu, who, some say, listed Transcorp in a dubious effort to pump its valuation and make the prestigious list himself.”
The mention of being “Forbes-listed” so early in the article looks like it was key in the deliverables sought by the writer, but that should not detract from the work both parties have done and are still doing to help revive Nigeria’s power sector.
As at date, there are only two power companies quoted on the NGX. This is where many would agree the issue is. If this is not the case, what was the point in the write-up; what was the point in playing populism by linking the listing with the misfortune of some unnamed and perhaps non-existent “smaller investors.”?
By way of information, Transcorp Power Plc is an electricity-generating subsidiary of Transnational Corporation Plc (Transcorp Group), one of Africa’s leading, listed companies, with strategic investments in the power, hospitality, and energy sectors. Transcorp Power is committed to creating value and driving economic growth, by improving lives through access to electricity and transforming Africa.
Ikem Okuhu, a journalist and public relations consultant, writes from Lagos, Nigeria.
