Union Bank opens N50bn Rights Issue

Fri, Sep 22, 2017 | By publisher


Banking Briefs

 

UNION Bank of Nigeria Plc has opened application for its N50 billion rights issue, paving the way for shareholders to pick up their shares. Application for the rights issue will close on Monday October 30.

The bank is raising N49.745 billion from existing shareholders through a rights issue of 12.133 billion ordinary shares of 50 kobo each at N4.10 per share.

The bank, in a statement on Wednesday, September 20, said the rights issue has been pre-allotted on the basis of five new ordinary shares of 50 kobo each for every seven ordinary shares held as at the close of business on Monday, August 21.

The shares are also tradable on the Nigerian Stock Exchange, NSE, during the offer period, giving shareholders that fully or partly renounced their rights opportunity to trade them at profit. Union Bank’s share price opens today at the NSE at N5.72 per share.

The net proceeds of the rights issue will be used to enhance the bank’s regulatory capital requirement, increase working capital and grow in strategic areas that correspond to emerging opportunities in Nigeria, enhance technological platforms through strategic investments in technology and digitalisation and optimise customer experience with investments in customer touch points.

Emeka Emuwa, chief executive officer of the bank, has said the new capital raising is critical to the bank’s short to medium term business objectives as the new equity funds will support the bank’s strategy to accelerate business growth and position it as a leading commercial bank in Nigeria.

“With the commencement of the rights issue subscription, we have now officially entered a new phase of our transformation where we will be focused on accelerating business growth to deliver on our objective of becoming one of Nigeria’s leading financial institutions,” Emuwa said.

The bank has kicked off a road show to sensitise shareholders in Enugu, last week. Shareholders’ fora will also be held in Lagos, Port-Harcourt and Abuja later this month. Chapel Hill Advisory Partners Limited is Lead Issuing House to the offer while FSDH Merchant Bank Limited and Stanbic IBTC Capital Limited are Joint Issuing Houses.

Established in 1917 and listed on the NSE in 1971, Union Bank is a household name and one of Nigeria’s long-standing financial institutions.

Key extracts of the six-month report of UBN for the period ended June 30, 2017 had shown that gross earnings rose by 23 percent to N73.7 billion in first half 2017 as against N60.1 billion recorded in first half 2016.

Profit before tax rose marginally by six per cent from N8.9 billion to N9.5 billion. Customer deposits grew by 15 per cent to N759.3 billion in 2017 as against N658.4 billion in 2016.

– Sept 22, 2017 @ 10:06 GMT /

 

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