Dangote Sugar merges with NASCON

E kaaro o, Ututu Oma, Barka da Safiya - Good morning, and a warm welcome to ThinkBusiness Nigeria, your Monday – Friday dose of commentary, contexts, and insights on business and economic news that matter to you.

Its Gabon’s turn.

Oh yes, life is turn by turn. The coup in Gabon yesterday is another awful reminder that human’s patience and resilience have limits, especially in the face of rising living costs, and the global social media landscape that shows how other countries are “taking back” their countries from Charlatans.

I wish I can tell you that it will be the end. It may not.

What should be important is the realization that democracy is beyond civilian rule and elections. The essential element of democracy is freedom, and wherever and whenever those freedoms are threatened, democracy itself is threatened.

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Markets

• The benchmark NGX All-Share Index (ASI) pared 50.81 (-0.08%) points to close at 66,439.53, showing a week gain of 1.45%, a 4-week gain of 3.38%, and an overall year-to-date gain of 29.64%. Transcorp Nigeria shares declined 9.99% at NGN 6.31 per share, followed by Computer Warehouse Group (-9.88%), Ikeja Hotel (-9.84%) and FTN Cocoa Processors (-8.11%).

• Oil prices extended gains on Wednesday, August 30, after US government data showed tighter-than-expected crude supplies in US, while hurricane Idalia kept investors on edge. Brent crude futures for October rose 40 cents to US $85.85 a barrel and the WTI increased by 0.55% or 45cents to US $81.61

• Naira was mix at both the I&E Window and on the streets. On the I&E exchange, Naira appreciated by 4.80%, closing at a rate of N738.18 against the US dollar. On the streets, Naira was down by 0.26%, reaching a value of N922.50 against the US dollar.

• US natural gas futures rose above $2.7/MMBtu, supported by hotter weather forecasts as gas traders are closely monitoring the impact of Hurricane Idalia on supply and demand. Despite short-term cooling reducing demand, extended hot weather is forecasted until mid-September.

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National Headlines

• Dangote Sugar merges with NASCON – Dangote Sugar has announced plans to merge with NASCON and Dangote Rice Ltd. The merger will be concluded through scheme of consideration – share exchanges in this case. All companies are under the Dangote group and this merger brings under one roof Dangote’s food business. NASCON is known for its salt, seasoning and spices, while Dangote rice focuses on its growing rice cultivation and milling business. The merger will not only bring all Dangote food business under one roof (should be called Dangote Foods!), but it will also allow integrated marketing, sales, and logistics.

Global Headlines

• Its Gabon’s Turn – Life is turn by turn. Yesterday was Gabon’s turn to be admitted into the league of African nations with military heads of States. It followed Niger just after two months, and there is no guarantee that we have seen the end of this pattern. President Ali Bongo had contested and won what was widely condemned as a shabby election devoid of basic democratic principles. This is the eight coup in Africa in the last few years, and all are in former French colonies. Unlike in Niger recently, the response to the coup in Gabon is rather mixed. While many reject military rule, they also acknowledge that the nature of democracy practiced by these countries were far from acceptable. The officers declared on television that the election results were cancelled, borders closed, and state institutions dissolved, after a tense vote that was set to extend the Bongo family's more than half century in power.

• Further restrictions on Technology exports – The US has doubled down on its technology export restrictions. The government has added the Nvidia artificial intelligence chip to the list of technology products and services not eligible for exports to selected countries in the middle east. The company made the announcement in a regulatory filing. Geopolitical tensions have worsened since the Russia /Ukraine war and has been felt largely in trade and technology. It follows the supply chain disruptions during and the aftermath of the Covid – 19 Pandemic. However, it is much more than that. Both US and China see a renewed race in technology development as the race for superiority in every sphere of the future, including warfare, space, climate, and artificial intelligence.