Govt in the dark over Namcor’s Recon stake sale
Although Namcor has already completed a letter of intent with ReconAfrica to shed its 5%, government yesterday said it did not approve such a move.
OGONE TLHAGE
WINDHOEK
“We were not even aware of a potential transaction until it appeared in the media.”
These are the words of public enterprises minister Leon Jooste yesterday regarding National Petroleum Corporation of Namibia’s (Namcor) intent to share half of its stake in the Kavango Basin project currently being explored by Canadian firm ReconAfrica.
ReconAfrica voiced intent to purchase Namcor’s 5% stake in the project in a deal worth C$31.75 million (N$377.5 million) and US$2 million (N$30.2 million) in cash.
Namcor’s managing director Imms Mulunga, speaking on The Evening Review recently, said the company will sell a 5% stake in the project to raise money it may need for future investments.
“With the ReconAfrica licence, we have a 10% carried interest and I think we have received some criticism from some parliamentarians and I think that criticism is not unwarranted where Namcor only has a 10% stake, but while the value of the share price of ReconAfrica keeps on appreciating and appreciating, the company becomes bigger and bigger, so we have decided recently to convert 5% of that into shares so we are currently doing a deal with ReconAfrica where we are almost going to sell our 5% to them and they will give us 5% shares in ReconAfrica,” Mulunga said.
The move would help improve the company’s liquidity, he added.
“We are just going to make some of those shares liquid, to make sure we have access to funds if we are required to make other investments or to use some of that money to grow our downstream business as an example.”
Cabinet must decide
ReconAfrica already announced that it has entered into a letter of intent with Namcor for the acquisition of the shares on 17 February.
Jooste yesterday told Namibian Sun Namcor that government has not sanctioned Namcor to sell its shareholding in the project.
He said Cabinet would have the final say.
“I made it clear to the chairperson [of the Namcor board] that such a transaction will require prior approval and that they may not proceed until they have obtained formal approval,” Jooste said.
He added that Namcor had approached ReconAfrica with a view to dispose of its 5% shareholding in the project.
“Government did not approach ReconAfrica on this. I have been told that they were approached by Namcor who wanted to sell 5% to a foreign buyer,” he said.
Who said that?
Due consideration would be made over the decision to sell or hold onto the 5% stake once a formal submission had been made on the part of Treasury, he added.
“I have requested them to forward the information to me for consideration and approval. I am still waiting for the submission. Important to note that the transaction has not been concluded and that it will not be until Treasury approval is granted,” Jooste said.
Mulunga yesterday brushed aside questions posed to him regarding government’s stance, saying: “Who said Namcor should get a Cabinet approval to conduct its day-to-day business?
“We have nothing to say, we are not going to conduct our business in the media.”
WINDHOEK
“We were not even aware of a potential transaction until it appeared in the media.”
These are the words of public enterprises minister Leon Jooste yesterday regarding National Petroleum Corporation of Namibia’s (Namcor) intent to share half of its stake in the Kavango Basin project currently being explored by Canadian firm ReconAfrica.
ReconAfrica voiced intent to purchase Namcor’s 5% stake in the project in a deal worth C$31.75 million (N$377.5 million) and US$2 million (N$30.2 million) in cash.
Namcor’s managing director Imms Mulunga, speaking on The Evening Review recently, said the company will sell a 5% stake in the project to raise money it may need for future investments.
“With the ReconAfrica licence, we have a 10% carried interest and I think we have received some criticism from some parliamentarians and I think that criticism is not unwarranted where Namcor only has a 10% stake, but while the value of the share price of ReconAfrica keeps on appreciating and appreciating, the company becomes bigger and bigger, so we have decided recently to convert 5% of that into shares so we are currently doing a deal with ReconAfrica where we are almost going to sell our 5% to them and they will give us 5% shares in ReconAfrica,” Mulunga said.
The move would help improve the company’s liquidity, he added.
“We are just going to make some of those shares liquid, to make sure we have access to funds if we are required to make other investments or to use some of that money to grow our downstream business as an example.”
Cabinet must decide
ReconAfrica already announced that it has entered into a letter of intent with Namcor for the acquisition of the shares on 17 February.
Jooste yesterday told Namibian Sun Namcor that government has not sanctioned Namcor to sell its shareholding in the project.
He said Cabinet would have the final say.
“I made it clear to the chairperson [of the Namcor board] that such a transaction will require prior approval and that they may not proceed until they have obtained formal approval,” Jooste said.
He added that Namcor had approached ReconAfrica with a view to dispose of its 5% shareholding in the project.
“Government did not approach ReconAfrica on this. I have been told that they were approached by Namcor who wanted to sell 5% to a foreign buyer,” he said.
Who said that?
Due consideration would be made over the decision to sell or hold onto the 5% stake once a formal submission had been made on the part of Treasury, he added.
“I have requested them to forward the information to me for consideration and approval. I am still waiting for the submission. Important to note that the transaction has not been concluded and that it will not be until Treasury approval is granted,” Jooste said.
Mulunga yesterday brushed aside questions posed to him regarding government’s stance, saying: “Who said Namcor should get a Cabinet approval to conduct its day-to-day business?
“We have nothing to say, we are not going to conduct our business in the media.”
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