Nampak shares soar over Nigerian exit plan

Shares in Nampak yesterday surged more than 18% after Africa's largest packaging group said it was selling its Nigerian operation in a deal valued at $68.5m. Fin24 reports that Nampak's Bevcan Nigeria business has been on the chopping block for a while as the group grapples a hefty debt pile and looks to focus on being a metals business based largely out of SA. While the Nigerian business is a strong performer from an operational point of view, it has also been a major drag on earnings amid foreign exchange losses that have also hit JSE-listed firms like MTN. Nampak has also previously conceded that it had made poor asset allocation choices and overpaid for acquisitions in its quest to expand aggressively into the rest of Africa. With turnaround specialist Phil Roux at the helm as the group's new CEO, it has embarked on an asset disposal process, also announcing in March it intends to sell its SA liquid cartons business, as well as units in Malawi and Zambia. The disposal still requires approval from shareholders, but the market reacted positively to the news. Shares in Nampak leapt immediately after the announcement, trading 18.5% higher late yesterday.