Would you like to receive notifications for Breaking news and updates?
(Photo Credit: The Nation Newspaper)
Stuggling company, Omatek, is in need of funds, and management of the company have been authorised to seek for investors willing to inject fresh capital into Omatek. The company has been struggling financially and buried in debt.
During Omatek's 7th and 11th Annual General Meeting held last week, a resolution was passed, directing Board of Directors of the Company to conducting fundraising that will aid the operation of Omatek, "The Board of Directors of the Company is hereby authorised to source for investors and or any other means of raising funds for the business of the Company."
The resolution comes more than a year after Nigerian Stock Exchange (NSE) suspended the company from trading following failure to submit its financial statements of five years operation. Omatek floated the listing rules of the NSE, leading to the company amassing debt owed to the NSE.
AllNews findings showed that for every default on financial statements deadline, and grace of extension, NSE fines companies listed on its trading platform, “If an Issuer fails to file the relevant accounts by the expiration of the Cure Period, The Exchange will send to the Issuer a “Second Filing Deficiency Notification” within two (2) business days after the end of the Cure Period; suspend trading in the Issuer’s securities; and notify the Securities and Exchange Commission (SEC) and the Market within twenty- four (24) hours of the suspension.”
Along with the suspension is fine which is categorised between (i) NGN100,000 per day for the first ninety (90) calendar days of non-compliance, (ii) N200,000 per day for the next ninety (90) calendar days of non-compliance, (iii) N400,000 per day thereafter until the date of submission.
Omatek was suspended in October 2019, with NSE slamming the company with a distress sign, which send a risk signal to investors.
Omatek has been struggling to service its NGN5.81 billion debt which the company borrowed from Bank of Industry in 2012. The amount was obtained as credit facility, but it has defaulted on repayment, leading to the closure of Omatek's factory.
BOI said effort to retrieve the debt from Omatek has proved abortive, hence, the shutdown of Omatek's factory. The company assembles computer cases, speakers, keyboards and mouse, other than Computer systems and Notebooks in Nigeria and distribute in some African markets.
With the debt hanging over Omatek and the risk signal hovering over it, attracting investors to inject funds in the company will be an uphill task for the company's management.