Nigerian stocks recovered to end slightly higher on Wednesday, after the country’s biggest listed firm Dangote Cement recouped early losses.
Stocks had earlier fallen 1.09 percent, dragged down by a 5 percent drop in Dangote Cement as traders booked profits following a stake sale that had lifted the shares.
Dangote Industries Limited, owned by Africa’s richest man Aliko Dangote, sold a 2.3 percent stake in Dangote Cement to some foreign funds on Tuesday.
Dangote Cement, which accounts for a third of total market capitalisation, closed flat.
The market main index rose 0.5 percent to close at 36,905 points. Prior to Friday, stocks had gained for 16 straight days, posting their longest winning streak in more than two years.
Other gainers included Guinness Nigeria, the local unit of Diageo, which is in the market to raise 39.7 billion naira. It rose 4.99 percent.
Lafarge Africa also gained 5 percent, while Skye Bank, Flour Mills of Nigeria and aviation services firm NAHCO rose more than 4 percent each.
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Nigeria’s Dangote Industries Limited sold a 2.3 percent stake in Dangote Cement to foreign investors on Tuesday in a stock market deal valued at 86.1 billion naira ($236 million).
Africa’s biggest cement maker has been selling small stakes to increase its free float, which is well below the Nigerian stock exchange’s required level.
A spokesman for the Nigerian Stock Exchange said 416 million shares of Dangote Cement were sold on Tuesday at 210 naira each in six off-market deals negotiated between Stanbic IBTC and Meristem stockbrokers.
The price was below Dangote Cement’s closing price on Monday of 223.75 naira. Shares in the company, owned by Africa’s richest man Aliko Dangote, jumped after news of the share sale, closing up 7.3 percent at 240 naira, valuing the company at 4.09 trillion naira ($11.2 billion).
A spokesman for the cement maker said the deal was between Dangote Industries Limited and some foreign investors, whom he did not identify.
In 2013, Dangote Industries sold 1.5 percent of its 95 percent stake in Dangote Cement to South Africa’s Public Investment Corporation (PIC) for $289.3 million.
Subsequently it sold a 1.4 percent stake to Sovereign fund Investment Corp of Dubai (ICD) for $300 million in 2014.
However it faces competition in Africa from French cement maker Lafarge which has combined its Nigerian and South African businesses to accelerate growth on the continent, as well as other local rivals.