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Re: Dangote's Nominal Transfer




Thursday, June 9, 2011, Dr. Ibrahim BELLO
The market announcement on the ‘Nominal Transfer of all Dangote Industries Limited Africa Cement Interests to Dangote Cement Plc’make for an interesting read ; perhaps because of what it failed to say about the grey areas it threw up.
Quite frankly, most investors in the market are unsure of what interpretation should be given to the notice of "nominal transfer" issued to the exchange by Dangote Cement Plc.
Some of the questions that immediately come up include:
1.    Under what circumstance is a nominal transfer made in the securities market?
2.    Is Dangote Cement Plc the same thing as Dangote Industries Plc?
3.    Shall we construe the transfer from DIL to DANGCEM as a gift?
4.    What is the value of the assets that are being transferred?
5.    Are there liabilities attached to these assets?
6.    Where in Africa are these assets held?
7.    What will be the impact of this on the balance sheet of DANGCEM?
8.    What are the profit implications?
9.    From the notice, do we take it that DIL also has cement interests in Nigeria outside those held through DANGCEM?
The point: The notice is a piece of incomplete information; it raises a lot more questions than offer any answers to existing questions.

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