Africa

Omnia Holdings Ltd. plans to conclude a 2 billion rand ($140 million) rights issue within the next two months as part of restructuring the group’s debt, Bloomberg News reported. While the fertilizer maker has been struggling to service debt in recent months, it managed to secure a 6.8 billion-rand bridge-loan facility from four banks this week. Proceeds from the rights issue will be used to pay back a part of the loan facility in the next two months, Omnia Chief Financial Officer Seelan Gobalsamy said Tuesday by phone.

Vedanta Resources said it would take urgent steps to protect its Zambian assets and pursue international arbitration if necessary after a Lusaka court on Thursday rejected its request to be included in liquidation proceedings, Reuters reported. A Lusaka judge on Thursday ruled Vedanta Resources could not take part in proceedings to wind up its Konkola Copper Mines (KCM) business in Zambia, but granted Vedanta leave to appeal the ruling. The company said it would consider whether to do so. The case has intensified concerns among international miners about resource nationalism in Africa.

South Africa’s state-owned electricity company is groaning under more than $30 billion of debt, and doesn’t generate enough cash to service it, Bloomberg News reported. Investors can’t get enough of it. Eskom Holdings SOC Ltd.’s 2028 dollar securities have handed bondholders a whopping 22.3% return this year, more than the debt of any other emerging-market utility and almost three times the average for developing-nation hard-currency bonds, according to Bloomberg Barclays indexes.

Steinhoff International Holdings NV is seeking another extension to restructure almost $12 billion of debt as the retailer strives to keep shop doors open and increase the value of some of its assets, Bloomberg News reported. The South African retailer will probably miss a June 30 deadline for agreeing a debt deal, the owner of Conforama in France and Mattress Firm in the U.S. said in its 2018 annual report published late Tuesday. Steinhoff needs time to prepare some divisions for an eventual sale that will enable it to repay creditors, the company said.

A Kenyan parliamentary committee on Tuesday recommended nationalising Kenya Airways as part of an effort to turn around the loss-making airline, Reuters reported. The transport, public works and housing committee also proposed setting up of an aviation holding company with four subsidiaries, one of which would run Kenya Airways, which is 48.9% owned by the state and 7.8% by Air France-KLM. Under the proposals, which still need to be debated and voted on by parliament, another arm of the holding company would operate Nairobi’s main international airport.

Kenya will more than double its capital gains tax rate to 12.5% from 5% to bring it in line with international standards, Finance Minister Henry Rotich said in budget proposals to parliament on Thursday, Reuters reported. Analysts said the move showed the government had opted to squeeze already hard-pressed taxpayers, rather than cut expenditure, to make ends meet. “They are basically trying to get more and more out of a small tax base,” said Kenneth Minjire, head of securities at Nairobi-based Genghis Capital.

Sub-Saharan African states have borrowed so much money since the debt forgiveness programmes earlier this century that they risk falling back into financial distress, Fitch warned today, the Financial TImes reported. However, the rating agency argued that multilateral debt relief had not been squandered, as some have argued, because it has “delivered lasting benefits” in the form of faster economic growth and improvements in measures of human development.

South Africa’s Competition Tribunal ordered antitrust investigators to clarify charges of currency manipulation against more than 20 banks, drawing out a four-year legal battle, Reuters reported. The Tribunal, which oversees antitrust cases, found deficiencies in referrals prepared by the Competition Commission and gave the body 40 days to redraft its accusations, according to a statement on Wednesday. However, it also rejected attempts by banks to dismiss the case.

Glencore has hoisted the “for sale” sign over the Chad-focused oil business it acquired five years ago as the miner and commodity trader looks to bolster a share buyback programme by selling non-core assets, The Irish Times reported. The London-listed group, run by Ivan Glasenberg, bought Caracal Energy for $1.6 billion (€1.4 billion) in 2014 as part of a plan to grow its African oil business and secure barrels for its muscular trading arm. However, the deal was completed just before oil prices peaked and Glencore was subsequently forced to take a series of impairment charges.

Eskom Holdings SOC Ltd. should quit coal-fired generation over the next 20 years, Greenpeace Africa said, even as the beleaguered South African power utility presses ahead with new plants, Bloomberg News reported. Such a shift would require a massive overhaul at Eskom since coal-fed power is the backbone of its fleet, with two new stations currently under construction. But the debt-strapped utility, which supplies more than 90% of South Africa’s electricity, is under fire from environmental groups who claim it’s far from ready for the global transition to cleaner fuels.