Union Bank to raise N180bn from strategic investors
Currently, the bank’s shares stand at 15-billion; at N40 a share, the bank’s market capitalisation is N600-billion.
This means that when a few strategic investors take 30 percent of the bank’s current shares, a total of N180-billion would be raised.
Financial experts say the move is bound to change the banking horizon.
Speculations are rife that the amount to be raised might be far ahead of the N180-billion as sales of such shares to strategic investors would be negotiated and could not go at the current market price.
The bank is billed to hold its extra-ordinary board meeting on September 27, and the outcome will set the stage for the raising of the funds.
Though the bank is yet to put an exact figure on how much it seeks to raise, Business Day has gathered that the bank may cede a maximum of 30 percent of its current shareholders’ funds to strategic investors with multinational banking experience.
The bank also wants shareholders’ approval to write off the goodwill of N15.72-billion, which arose "from the acquisition of Universal Trust Bank plc, Broad Bank of Nigeria Limited and Union Merchant Bank Limited from the N71.06-billion in the Share Premium Account and to utilise part of the Share Premium Account in writing off the outstanding goodwill as provided by Companies and Allied Matters Act 1990."
Barth Ebong, group managing director of the bank, said the measures were part of the bank’s strategic efforts towards further positioning it for the unfolding domestic and global challenges of today’s banking as well as consolidate its leadership position in the industry.
Meanwhile, the bank has established 10 additional area offices to bring the total to 23.
The bank also changed its directorate of management services to risk management and control.
Ebong, in a press statement, said the creation was in line with the continuing repositioning of the bank for greater efficiency.
The additional area offices, according to him, will further decentralise the bank’s operations and position it to respond adequately to the unfolding domestic and global challenges in modern-day banking by bringing the bank closer to the customers.
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