About Fenikso
Fenikso Limited, formerly known as Lekoil Limited, is a Cayman Islands-based holding company focused on the oil and gas sector in Nigeria. Its principal asset is a US$51.9 million loan extended to Lekoil & Gas Investments (LOGI), a wholly owned subsidiary of Lekoil Nigeria. This loan is being repaid through proceeds from oil sales at the Otakikpo field, with Fenikso entitled to 8.65% of the revenue generated. The company is listed on the Aquis Exchange under the ticker FNK.
FNK Today
As of March 2025, the business is essentially composed of three primary items:
| Asset Portfolio | Valution (USDm) | Valution (GBPm) |
|---|---|---|
| Cash and Investments | 6.5 | £5.2 |
| LOGI Loan Receivable | 38.0 | £30.2 |
| SEIL Loan Payable | (11.5) | (£9.2) |
| Net Assets | £26.2 | |
| Net Assets / Share | £0.053 |
Assumes 493m FDSO (i.e. excludes recently announced share buyback)
Based on my current calculations There is no ‘active’ business ongoing, however management is investing cash balance into certain fixed income instruments for yield. Operating costs are c. £0.4m p.a based on recent accounts.
The Opportunity
Fenikso currently has a marketcap of £7.4m (at 1.50 GBX/share) (sidenote - Fenikso is very illiquid).
The NAV is £26.2m, meaning a hypothetical c. 300% discount. This discount was well warranted from a very tumultuous history - including legal disputes and various restructurings. However, I believe some of this risk has been removed, evidenced by:
- 1) History of stable repayments from LOGI over the last 12 months
- 2) De-risked balance sheet, with cash of £5.2m backing c. 70% of the shared price. Likely to reach >100% cash backing in the next six months
- 3) Share buyback implemented
What you have to believe
- LOGI continues stable production
- Fenikso is dependent on continued stable production operations of the Otakikpo field by Lekoil (as well as stable oil prices)
- Lekoil must also continue fulfilling the loan agreement with Fenikso, newsflow is generally positive and presents nothing to the contraray
- Nigeria economic stability
- Lekoil, and Fenikso in turn, is dependent on Nigeria economic stability
- Nigeria inflation appears to be moving under control and with this NGN stability appears on the horizon
- Dangote oil refinery is scaling up production to 100% production capacity, providing economic development as well as a local crude buyer
- Management will return funds to shareholders
- One would expect as the cash balance continues to build, there will be a clear focus on returning cash to shareholders (before an eventual wind up)
- Shareholders have approved a share buyback of up to c. 15% of outstanding shares during the 2024 AGM
How this Could Play Out
Based on extrapolation of recent payments and cashflows, it is reasonable to expect Fenikso should reach 100% cash backing at 1.50 GBX/share by Q4 2025.
If we extrapolate even further, based on last twelve months of payments, we would expect the LOGI loan to be fully repaid in c. 2029/30.
| LOGI Loan | FENIKSO Cash/Investments | Cash Backing (@ 1.50 GBX) | |||||||
|---|---|---|---|---|---|---|---|---|---|
| USDm | Date | BoP | Payment | EoP | BoP | Cash Mvmt | Costs | EoP | |
| Payment | 30/10/2023 | 47.8 | 1 | 46.8 | 0 | 0.5 | |||
| Payment | 28/11/2023 | 46.8 | 0.9 | 45.9 | 0.5 | 1.5 | |||
| Payment | 22/12/2023 | 45.9 | 0.7 | 45.2 | 1.5 | 0.5 | 2 | ||
| Payment | 25/01/2024 | 45.2 | 0.8 | 44.4 | 2 | 0.5 | 2.5 | ||
| Payment | 09/04/2024 | 44.4 | 0.8 | 43.5 | 2.5 | 0.5 | 3 | ||
| Payment | 15/05/2024 | 43.5 | 1.3 | 42.2 | 3 | 1.0 | 4 | ||
| Payment | 05/07/2024 | 42.2 | 1.3 | 40.9 | 3 | 1.0 | 4 | 42% | |
| Payment | 15/08/2024 | 40.9 | 0.8 | 40.1 | 4 | 0.1 | 5.5 | 58% | |
| Payment | 24/09/2024 | 40.1 | 0.7 | 39.4 | 5.5 | 0.6 | 6.1 | 64% | |
| Payment | 28/10/2024 | 39.4 | 0.4 | 39.0 | 6.1 | 0.1 | 6.2 | 66% | |
| Payment | 12/12/2024 | 39 | 0.5 | 38.5 | 6.2 | 0.1 | 6.3 | 67% | |
| Payment | 31/1/2025 | 38.5 | 0.4 | 38.1 | 6.3 | 0.10 | 6.5 | 69% | |
| Forecast | 14/03/2025 | 38.1 | 0.8 | 37.3 | 6.5 | 0.50 | 7.00 | 74% | |
| Forecast | 25/04/2025 | 37.3 | 0.8 | 36.5 | 7.00 | 0.50 | 7.50 | 79% | |
| Forecast | 07/06/2025 | 36.5 | 0.8 | 35.7 | 7.50 | 0.50 | 8.00 | 85% | |
| Forecast | 19/07/2025 | 35.7 | 0.8 | 34.9 | 8.00 | 0.50 | 8.50 | 90% | |
| Forecast | 31/08/2025 | 34.9 | 0.8 | 34.1 | 8.50 | 0.50 | 9.00 | 95% | |
| Forecast | 12/10/2025 | 34.1 | 0.8 | 33.3 | 9.00 | 0.50 | 9.50 | 100% | |
| Forecast | 24/11/2025 | 33.3 | 0.8 | 32.5 | 9.50 | 0.50 | 10.00 | 106% |