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Asset Management Corporation of Nigeria (AMCON) said on Tuesday that it was planning to offload its majority stake in Peugeot Automobile Nigeria (PAN) Limited, a local joint venture with the major French automaker, Peugeot Citroen, and was seeking investors with experience in automobile manufacturing to buy the stake on offer.
Peugeot Citroen is the technical partner to the Nigerian assembly plant, which has capacity to assemble 240 cars a day.
AMCON said in a statement that it owned 79.3 percent of PAN Nigeria Limited, having acquired the stake four years ago after purchasing the company’s debt and taking some as equity.
AMCON, which disclosed that PAN Nigeria had assets totalling N24.96 billion ($125.43 million) as of December 2014 and equity of N11.98 billion, said the bids for its majority stake in the auto assembly company will close on Jan. 26 at 1600GMT.
PAN Nigeria Limited was set up in 1972 as a joint venture between the Nigerian government and Peugeot of France, with an annual production of 90,000 cars by the 1980s.
However, operations nosedived and the company accumulated bad loans shortly after the government sold its stake via a privatisation to local core investors in 2006.
AMCON was set up to absorb bad loans from banks after a $4 billion bailout in 2009 rescued nine lenders from collapse. AMCON then bought bad loans at a discount in exchange for government-backed bonds and has since been selling off collaterals against those loans to pay bondholders.
Courtesy: Reuters
