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Bond Market News
Olam Denies Reports of $50bn Forex Fraud in Nigeria; Orders Audit Committee to Conduct Review
September 12, 2023
Singapore-based food and agri-business group Olam has been in the news recently, following reports from Nigerian newspapers of Olam Nigeria, Olam Group and its subsidiaries being investigated by the Department of State Services for alleged fraud of over $50bn. In response, Olam said that it “categorically denies” the allegations and that its board has directed the audit committee to “nevertheless conduct a review of the matter”, given the nature of the allegations.
The report from Daily Nigerian claimed that Olam, through its SPVs, had booked about $34bn with the Central Bank of Nigeria (CBN) as capital importation at official rates. However, instead of investing the proceeds, sources said that Olam “round-tripped the forex and sold to business men, especially oil and gas marketers and industries such Indorama and Fouani, at parallel market rates.” The Business Times noted that Olam’s cumulative turnover in Nigeria from FY2015 to FY2022 was $14bn and that the value of capital importations amounted to just $2.4bn, suggesting the inaccuracy of the allegations.
Olam’s SGD 5.375% Perp traded ~0.3 points lower to 95.90 cents on the dollar, yielding 6.98% to its call date in July 2026.
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