Crusader Nigeria issues N2.26bn rights issue

Crusader Nigeria Plc has issued a rights issue of N2.26bn zero coupon unsecured subordinated irredeemable convertible debenture stock at par, which will be on the basis of N50 debenture for every 100 ordinary shares of 50k each.The company said that the rights, payable in full on acceptance, are not tradable on the floors of the Nigerian Stock Exchange for the duration of the issue.The Chairman of the company, Prof. Monsur Kenku, noted that in 2008, the company set out to raise a total sum of N7.59bn through a rights issue of N3.59bn and a debenture issue of N4bn.He said, Due to the global meltdown and its effect on the local capital market at that time, the rights issue was aborted, while 85 per cent of the convertible debenture issue was subscribed for a total of N3.4bn.According to him, the purpose of the combined issue at the time was to enable the company create a strong and fully diversified financial services group, comprising insurance, financial services and property.He added that the firm also sought to finance the acquisition of new businesses, expansion of its existing businesses and products, expansion of its distribution network and upgrade the information technology infrastructure of the company.Kenku said that the issue, which was being undertaken on the back of new investor interest, is in tune with current market realities which was to restructure and strengthen the companys capital base, provide it with operating capital, enhance its working capital and upon conversion, reduce its financing gearing.In anticipation of the inevitability of raising additional capital by the company, he had said at the annual general meeting of the company in 2010 that shareholders had approved the additional capital raise via the issue of debt instrument, preference shares or ordinary shares or a combination of any of these options, whether by a way of private placement or rights to existing shareholders.He said that the board of directors had approved a right issue of N2.26bn zero coupon unsecured subordinated irredeemable convertible debenture stock of N100, each convertible into ordinary shares of the company at 60k at the discretion of the debenture holder.
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