Nigerian Mogul Femi Otedola Makes $398 Million In 90 Days

Jun 3 2014, 10:04am CDT | by

Nigerian energy mogul Femi Otedola has become at least $398 million richer between March 3 and June 2 as shares of Forte Oil PLC, a Nigerian Stock Exchange-listed energy distributor, surged 167% in that period.

Forte Oil PLC is primarily engaged in the distribution of petroleum products such as diesel, aviation fuel and Premium Motor Spirit (PMS). The company has over 500 company-owned, dealer-assisted and dealer-developed gas stations spread across the country, oil storage depots in Lagos and Rivers states, a Power plant and a Joint User Hydrant Installation facility in Lagos. The company also sells its own range of automobile lubricants.

On March 3, the company’s stock was trading at N88.4 ($0.55), and at the close of trading today (Monday), its share price was N235.79 ($1.46). According to Akinbamidele Akintola, Vice President, Africa equity sales at Renaissance Capital, the recent unprecedented demand and surge in Forte Oil’s shares may not be unconnected to the company’s recent inclusion in the Morgan Stanley Capital International (MSCI) Frontier Market 100 Index. Listing in such indexes usually attracts interest from global investors who track these companies.

Otedola became the largest shareholder in Forte Oil (formerly called African Petroleum) in 2007 when he acquired a 28.7% stake in the company from the government-owned oil company, the Nigerian National Petroleum Corporation (NNPC), for $120 million. He subsequently appointed himself as chairman of the company. Otedola, 47, has gobbled up additional shares over the years and now owns more than 40% of the $1.5 billion (Market Capitalization) company. According to information available from registrar sources, he currently owns 436,809,537 shares valued at N103 billion ($635 million). He pocketed at least $11 million in dividends from profits made by his company in February as Forte Oil paid shareholders a dividend of N4 ($0.0023) per ordinary share from its 2013 profits. A representative for Femi Otedola could not be reached for comment at press time.

Otedola briefly featured on FORBES’ billionaires list in 2009 but dropped out of the rankings shortly afterwards when shares of his African Petroleum (now called Forte Oil) plunged more than 80% in the wake of a personal feud with Aliko Dangote. At the time, Otedola told anyone who cared to listen that Dangote used his far-reaching influence as the president of the Nigerian Stock Exchange to manipulate African Petroleum shares to settle their personal difference. The two have since become friends. Otedola is listed on the FORBES list of the 50 richest Africans with a fortune we estimated at $410 million in November. With the recent surge in Forte Oil shares, we now peg his fortune at over $800 million. If Forte Oil’s stock continues its upward trend, it might not be long before Otedola regains his billionaire status.

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