How Femi Otedola Took Over First Bank Nigeria (FBN)

Nigerian billionaire, Femi Otedola has taken over First Bank Nigeria (FBN) Plc.

 

Reports have it that Femi Otedola took over First Bank with his recent acquisition of about N30 billion worth of shares, making him the single largest shareholder of the bank.

 

According to the report, Otedola being the largest shareholder, means he holds the highest voting shares and can dictate the direction of the bank through his voting power.

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Recall Mr Otedola had divested his 75% direct and indirect share holding in Forte Oil, via a merger of his company Zenon Oil and former African Petroleum in 2019, the decision raised questions as to why he made such a decision especially because of the lucrative nature of the oil and gas sector. He had announced that he wanted to explore and maximize business opportunities in refining and petrochemicals.

 

He singled out First Bank despite having investments in the real estate and financial sector, for the single reason that there wasn’t exactly one man calling the shots there, unlike in other new generation banks, the report added.



Background

Femi Otedola pounced on the recent leadership crisis at First Bank, which saw both the bank’s chairman, Ibukun Awosika, and the chairman of FBN Holdings, Obafemi Otudeko, fired.

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Otedola is reportedly behind a massive mop-up of the shares of FBN Holdings, which would result in his becoming the single majority shareholder of the company.

 

Sources with knowledge of the purchase said majority ownership of FBN Holding Company, owners of Nigeria’s oldest bank, First Bank, is about to be upturned following months of slow and meticulous purchase of the company shares on the floor of the Nigerian Stock Exchange by Otedola.

How Femi Otedola Took Over First Bank Nigeria (FBN)

Otedola has been gradually accumulating his ownership and surpassing shares owned by any other single shareholder of the bank.

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An official announcement would be coming in the days ahead.

 

Otedola has been acquiring the shares of the bank through a vehicle, Calvados Global Services Limited. It is also likely that there could be other vehicles associated with Otedola who may have also been mopping up shares.



FBNH currently has 34.7 billion of its shares floating freely meaning it is held by diverse shareholders. This makes the shares easy to acquire on the stock exchange.

 

It was gathered that Otedola, through his proxies and investing vehicles, now owns over five per cent of the bank, setting himself up to be the single largest shareholder of the bank.

 

Industry assumptions have often suggested billionaire Oba Otudeko is the single majority owner of the bank, considering the enormous control he wielded over the bank for years. However, his latest debacle with the Central Bank following the failed removal of current MD/CEO Adesola Adeduntan marked a sudden end to his control of the bank providing an opening for Mr Otedola to move in on controlling the bank.

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The latest audited account of FBN Holdings does not have any shareholder with up to 5% of the ownership of the bank’s shares. However, Mr Otedola now owns over 5% of the bank.

 

FBNH currently has a total outstanding shareholding of 39.5 billion units and a market capitalization of N423.5 billion. According to information contained in the 2020 FY report of the bank, 40 shareholders owned 31.03% of the bank while no individual shareholder held more than 5% of the bank. Shareholders with over 5% ownership of shares of a publicly quoted company are statutorily expected to declare ownership publicly.

 

The financial statement of the company also states Dr. Oba Otudeko owns 532 million units or 1.3% holding of the company. Oye Hassan Odukale reportedly owns 370 million units of the bank according to the information contained in its 2020 annual reports. The owner of Globacom, Mike Adenuga is also a major shareholder of the company but is thought to own far fewer shares than Oba Otudeko and the Odukales. It is also likely that they have other shares owned by proxies but not included in the shareholdings disclosed publicly.



Denial

Reacting, the holding company for First Bank of Nigeria Limited, FBN Holdings Plc, in a statement signed by its Company Secretary, Seyi Kosoko, and filed with the Nigerian Exchange Limited on Friday, said it had not received any notification of such acquisitions.

 

It said, “The attention of FBN Holdings Plc has been drawn to media reports today (Friday) that a certain individual has acquired significant shareholding interest in FBN Holdings Plc.

 

“As a listed company, the shares of FBN Holdings are publicly traded, and sale and acquisition of shares is expected in the normal course of business. We operate in a regulated environment, which requires notification of significant shareholding by shareholders to the company, where shares are held in different vehicles, further to which the company will notify the regulators and the public as appropriate.

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