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Investors jostle for shares of Ikeja Hotel over price appreciation

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Anthony Idigbe


•Analysts hopeful on bountiful yield for shareholders

After the lifting of suspension on shares of Ikeja hotel Plc on Monday 21, 2018, the shares of the hospitality giant jumped from N1.78 to N1.86 in about three hours, representing 4.5% increase, all to the astonishment of the general public.

Similarly, at the close of transactions on Tuesday and yesterday, Ikeja Hotel Plc sustained foothold on the equities sector of the Nigerian Stock Exchange (NSE), dominating other bluechip stocks on the gainers’ chart.
 
On Tuesday, the stock led 18 others with 9.68 per cent appreciation, to close at N2.04 per share while it gained 9.80 per cent to close at N2.24 per share at the close of transaction yesterday.

Analysts, operators and investors had expressed optimism that with the level of work done so far by the interim management to unlock the inherent value of its going concern, the company is well positioned for better days ahead.According to them, looking at the company more critically, especially within the hospitality industry in Nigeria, it is a super blue chip, particularly when one considers the assets under its chain.

The stakeholders noted that although the firm has been involved in a boardroom crisis, a development that led the shareholders to remove its Chairman, Goodie Ibru, early in 2015, at an Extra-Ordinary General Meeting, the company’s fundamentals are still upbeat.However, the stakeholders added that now that the board has sorted itself out, with the chairman sacrificing his position by stepping aside for the sake of the company’s longevity, the stock is now set for a quantum leap.

Specifically, the Managing Director of Crane Securities Limited, Mike Ezeh, said: “Ikeja hotels has been at a dormant position since the board politics that engulfed the company in the last couple of months. Looking at the company more critically, especially in the hospitality industry in Nigeria, it is a super blue chip, particularly when you look at the assets under its chain. Investors should take positions therein.”

The Publicity Secretary of the Independent Shareholders Association, Moses Igbrude, said: “Ikeja hotel before now was associated with poor corporate governance and family issues until SEC intervened by appointing Anthony Idigbe as chairman.

“But with this intervention, these problems have been resolved and the business is being properly run and this should reflect positively on the financials of the company. I am appealing to new board and management to sincerely bring their wealth of experience to bear for the benefit of all.

The NSE had on November 10, 2016, suspended trading on the shares of Ikeja Hotels Plc, following the continued dispute among the major shareholders of the company.According to the NSE, the suspension, which is pursuant to the Provisions of Rule 15.45 of its Rulebook, is to safeguard shareholders of the company as the dispute has negatively impacted the company’s governance structure.

But the Executive Director, Regulation, NSE, Tinu Awe, while speaking during the “Facts Behind the Restructuring of the Company”, held at the Exchange, in Lagos, yesterday, stated that trading would commence on the shares of the company.She noted that the new board have complied with the necessary regulatory requirements, as well as restored the company to the path of recovery.

The members of the board of Ikeja hotel Plc are Chief Anthony Idigbe, Dr. Alex Thomopolus, Mr. Waheed Olagunju, Mr. Toke Alex Ibru, Mrs. Fadeke Alamutu, Mr. Kunle Aluko, Mr. Ufuoma Ibru and Alhaji Abatcha Bulama.
 
Awe said: “We are satisfied with the work the Ikeja Hotels have done till date. This is an appropriate time to lift the suspension on the trading of the shares of the company. The expectation on the direction of the Quotations Committee of council is that the trading on the shares will be lifted on Monday.
 
“Those of you following the company will be aware that it has cleared the backlog of financials and indeed, this is now in compliance with the financial obligation up-to-date and given where the company is coming from, again, it is an example of a company picking itself up and putting it back on a track of recovery.
 
“The company had its AGM to clear the backlog of certain AGMs. So many things have happened during the period of the suspension, and it was the considerations of those things that led the Quotation Committee of NSE to decide that it is an appropriate time to lift the suspension.”On the current focus of company’s interim management, the Chairman, Chief Anthony Idigbe, said that while the forensic auditing of the company is expected soon, the management will unlock the inherent value of the company’s going concern.

He assured stakeholders that adherence to sound corporate governance, which is the hallmark of every well established hospitality business would be followed strictly.Furthermore, he explained that the management would intensify efforts to sustain investors’ confidence and return the company to its leadership position in the industry.
 
Idigbe said the company has put in place a solid structure that would ensure that every issue concerning succession plan is tackled.He added that the management has been able to settle all the conflicts that have to do with the old management, while ensuring that both the management and shareholders operate in the same direction.
 
“Looking at the business so far, it has been encouraging and profitable. The issue has been management issue and sufficient steps have been put in place to guard against any missteps again in future,” he added.


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