Thursday 02 September 2010
- Culled from The GuardianFor investors at Integrated Capital Services Limited (ICSL) who
had their fingers burnt during the capital market crash, there is now a silver
lining behind the dark clouds as the investment and financing institution has
concluded plans to restructure its portfolio and recapitalise the business by
additional N2 billion.
This development is in line with the Central Bank of Nigeria (CBN)
recommendation after a field examination of the firms financial position as at
December 31st, 2008. After the examination carried out between April 15 and 29,
2009, the board decided on far-reaching measures to get the firm back on track.
Already, a couple of investors have indicated interest to inject funds into the
company.
A source at the firm confirmed that one of the investors is willing to throw in
a whopping N1 billion subject to due diligence but regretted that actions of
the Economic and Financial Crimes Commission (EFCC) had put initial due
diligence in jeopardy.
“Yes, we have set in motion a process of recapitalising the business by
additional N2 billion. And an investor has been found to inject N1 billion
subject to due diligence. But I can tell you EFCC actions have put initial due
diligence process in jeopardyâ€, said a source who did not want his name on
print.
He further disclosed other measures put in place to lift the fortunes of the
firm, including recovery of loan assets and sale of vessel and real estate
assets, sale of some subsidiaries, and diversification into consultancy and
advisory services as well as energy, currency and commodity trading and
brokerage.
ICSL is one of the finance houses impacted by the recent global financial
crisis with huge exposure in the capital market. With initial capital base that
stood at about $1 million, the company grew its financials to over $30 million
prior to the meltdown.
As a result of the economic meltdown, the company suffered substantial losses
in its capital market operations in excess of N2 billion. As a result of the
losses, the companys secured investors such as Stanbic IBTC, Kakawa Discount
House and Value Card Plc sold assets belonging to the company to redeem their
obligations.
Consequently, the company lacked liquidity to pay maturing obligations, a
situation that has adversely affected many unsecured customers who have
complained to the EFCC and the regulatory bodies with the result that ICSL main
accounts at Stanbic IBTC Bank being frozen since September, 2009, further
worsening the companys woes.
The Managing Director of the company, Mr. Adeniyi Elumaro and some senior
management staffers had been severally arrested and detained by operatives of
EFCC at the instance of some high profile individuals whose investments with
ICSL were impacted.
When contacted, ICSL boss confirmed the development and pleaded with all
investors affected to be patient with the company, assuring that soon, the
scenario would be a thing of the past. He also urged EFCC to exercise restraint
from constant arrest and detention of members of staff of the company,
stressing that the action is adversely affecting the planned recapitalisation
and restructuring exercises.
ICSL is one of Nigerias long standing investments and financing institution
set up by Chartered Bank in 1989 and commenced business operation in 1990. The
firm was managed by Chartered Bank Plc for over 17 years and more recently by
IBTC Chartered Bank Plc following the merger of IBTC and Chartered Bank.
Licensed by CBN as finance house, the firm operates currency retail trading
through its subsidiary, ICSL Bureau De Change licensed by CBN, and is into
stockbrokerage and dealership through another of its subsidiary, Prudential
Securities Limited, which is licensed by Nigerian Stock Exchange and Securities
and Exchange Commission.
In April 2007, Investcorp Capital Limited, a financial consulting, portfolio
management and private equity firm, acquired IBTC Chartered Banks over 80 per
cent stake in the company and subsequently assumed management control.