VENTURES AFRICA – Over the past year, the Nigerian naira has lost more than 20 percent of its value, due to a number of factors including the global oil price fall. As a result, local traders have seen importation costs soar, investors have fled the local scene, and capital market players have had their wealth shrunk, though some may argue that it is just paper value.
Among the top losers are some of Nigeria’s most prominent wealthy businessmen, particularly those who control major companies listed on the country’s bourse.
Below are a few of these losers:
Aliko Dangote
Africa’s richest man, Aliko Dangote, who has built up fortunes over the past decades through his cement, sugar and flour mill companies and accounts for 25 percent of stock market, has been the biggest loser. According to financial times, Dangote has incurred a loss of about $5.4 bn, which has reduced his 2014-estimated fortune of $25.7 billion.
“A lot of people’s dreams have been killed because they are using naira-based income to fund dollar-denominated debt,” Mr Dangote told the Financial Times from his offices in Lagos recently.
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He however remains optimistic about the future prospects of the capital market. “If it is a race I can assure you I will come back stronger,” he says. “We have had a hard time for now, but the fundamentals of the business are there.”
Tony Elumelu
Tony Elumelu, the Chairman of proprietary investment firm, Heirs Holdings, has also fallen victim to the naira crisis. The Financial Times revealed recently that Tony, who has diversified interest in agriculture, banking, healthcare and power, has lost about $445 million in share value as one of his major investee group, Transcorp, has seen its stock nose-dive.
“It is paper value,” Tony quickly dismisses this in his reply to the Financial Times. “If you look at the people in this space, we are not short-term investors. We are not going to take our cash out tomorrow.”
Jim Ovia
Jim Ovia, the Chairman of Zenith Bank, is also among the top losers. Since January, his 9 percent stake in Zenith has lost more than $100 million. Jim, however, holds assets outside the capital market in Visafone, an mid-tier telecommunications company, offers the extroverted billionaire the much-needed respite.
