By Okechukwu Nnodim

Shareholders of Union Venture Plc have approved an increase in the firm’s capital base from N50m to N375m. The approval increased the firm’s capital base by 650 per cent.

According to a statement by the company on Friday, the 650 per cent capital base raise was endorsed by the company’s investors at its annual general meeting in Lagos recently.

The Chairman of the firm, Mr. Salihu Belgore, said the decision to increase the company’s capital was as a result of the necessity to boost the fortunes of the firm so as to compete effectively in its line of business.

He stated that the approval showed that the investors had confidence in the board and management of the company and he assured the shareholders of improved returns on their investment.

The President, National Shareholders Solidarity Association, Mr. Timothy Adesiyan, who represented shareholders of the firm, said the approval indicated the confidence, which investors had in the management of the company.

“When they have enough capital, they should be able to perform optimally, thereby, enhancing our investment,” he said.

Stressing that the harsh operating environment which the firm encountered in the previous year and its insufficient capital base affected it negatively, the Managing Director and Chief Executive, Union Venture, Mr. Wande Akinpelu, said the company could not post an impressive financial performance.

He noted that though the company did not record profit in its 2010 financial year, it was able to reduce its loss by over 90 per cent.

He said, “For instance, the loss figure stood at N1.1m in 2010 compared to a loss figure of N10.8m recorded in 2009, while the turnover of the company in 2010 went up to N40.4m from N33.5m posted in 2009.”

Akinpelu said the recent turn in the fortunes of the company was due to the acquisition of majority stake in the firm by a core investor group, adding that the development brought about increased vigour in the management of the company.

He added that the firm had commenced bulk purchase and sales of petroleum products at various depots in order to attain greater efficiency.

Source: Punch