ECOBANK Transnational Incorporated, ETI, has foreclosed the plan to sell some of its stake in its Nigeria subsidiary, Ecobank Nigeria Limited, due to falling equities’ prices. Ade Ayeyemi, chief executive officer of the bank, stated this in an interview with Bloomberg.
According to Ayeyemi, falling market values mean the bank would not get good deal from the sale. “The market is not right for us to be selling part of that unit. We will not be doing any dilution at the moment. You cannot sell an asset you don’t have to sell at the time when market prices are at the bottom of the trough. We are adequately capitalized at the moment,” Ayeyemi said. “If there are business opportunities that require us to have more capital, we will support that. We always have the option in future,” he said.
The bank had said that it would sell part of its stake in Ecobank Nigeria Plc by the end of the year to boost its working capital and meet up with the Central Bank of Nigeria, CBN’s directive on minimum capital threshold.
ETI had planned to raise as much as $400 million with a sale of about 25 percent of the Nigerian subsidiary. But the bank’s shares have fallen by 12 percent since the end of June, amid concern among investors that a slowdown in China, sub-Saharan Africa’s biggest trading partner, and a looming rise in U.S. interest rates may weigh on economic growth.
— Oct 19, 2015 @ 01:00 GMT