Eterna to raise ₦21.5bn by selling new shares at 37% discount

Eterna Plc has commenced a ₦21.52 billion rights issue priced at a sharp discount to its market value, as the downstream energy company seeks to strengthen its balance sheet and fund expansion amid volatile margins and foreign-exchange pressures.

The company is offering 978.1 million ordinary shares at ₦22 each, on the basis of three new shares for every four held as of Nov. 27, 2025. The offer opened on Monday and will close on Feb. 18, with the new shares ranking pari passu with existing stock.

Eterna’s shares closed at ₦35 on Friday and were trading around ₦34.30 by midday Monday, placing the rights issue at roughly a 37% discount. The pricing suggests the company is prioritising certainty of capital raising and strong shareholder participation over minimising dilution, particularly after weeks of price volatility that saw the stock trade as low as ₦28.50 in December.

The capital raise is expected to bolster liquidity and support growth across Eterna’s operations, which span fuel distribution, lubricant manufacturing, LPG retailing and aviation fuelling.

The company said proceeds will be deployed to expand its retail network, upgrade its lubricant blending plant, enhance LPG assets, acquire commercial delivery vehicles, grow aviation fuelling operations and invest in ESG-related projects. Part of the funds will also serve as working capital to finance inventory and short-term trade payables.

“This Rights Issue marks a significant step forward in our long-term strategy to consolidate Eterna’s leadership position in the downstream energy sector,” Chairman Gabriel Ogbechie said, adding that the funds would help the company pursue growth opportunities while delivering value to shareholders.

Mixed Financial Picture

The offer follows a mixed financial picture. While Eterna reported strong top-line growth, with revenue of ₦55.2 billion in the third quarter of 2025 and ₦212.8 billion over the full nine-month period, margins across the downstream sector have remained under pressure following fuel price deregulation and global oil price swings.

The company delivered ₦1.39 billion in profit before tax over the nine-month period, it posted a pre-tax loss of ₦171.6 million and a net loss of ₦247.9 million in the quarter ending September, squeezed by rising costs and razor-thin margins in fuel marketing. Total liabilities stood at ₦53 billion against ₦58 billion in assets, leaving limited headroom in a high-interest-rate and volatile FX environment.

Analysts say the discounted rights issue reflects both the need to repair leverage and the realities of Nigeria’s equity market.

Eterna is forecasting a turnaround in early 2026, projecting revenue of ₦60.8 billion and a net profit of ₦485 million in the first quarter, driven by scale, improved operational efficiency and better margin management.

Planet Capital Limited is acting as lead issuing house to the offer.