By Joy Baba-Yesufu
Recently, Access Holdings Plc got the approval of Nigeria’s Securities and Exchange Commission (SEC) to extend its ongoing rights issue to August 23, 2024. In line with the Central Bank of Nigeria (CBN) recapitalisation exercise, Access Holdings Plc has a capital raising programme of $1.5 billion, planned to be executed via equity, quasi-equity, and debt issuances.
Access Holdings Plc, one of Nigeria’s largest financial institutions plans to raise a staggering N351 billion through a rights issue. It is offering to existing shareholders 17.772 billion ordinary shares of 50 kobo each at N19.75 per share. The rights issue opened on Monday, July 8, 2024 and was initially scheduled to close on August 14.
Access Holdings extended the acceptance period for the rights issue, providing existing shareholders and other investors additional opportunity to participate in the new capital raising. In a regulatory filing at the Nigerian Exchange (NGX), Access Holdings explained that the decision to extend was in response to the recent nationwide protest that disrupted operations of businesses and individuals across Nigeria.
Aigboje Aig-Imoukhuede, chairman, Access Holdings Plc said the group decided on a rights issue as a commitment to the bond between the group and its shareholders. He noted that the group was committed to strengthening ties with shareholders and enhance value creation.
According to him, shareholder value was at the core of the group’s business vision and the group decided shareholders, who had endured to build the group to its enviable status should reap the benefits.
Aig-Imoukhuede said at the “Facts Behind the Rights Issue” session at the NGX that the group is moving to a new phase of its phenomenal growth where shareholders would reap bountiful returns on their investments. While urging shareholders to pick their rights as they stand to gain more from their investments, he said the additional capital will enable the group to maximise emerging opportunities and deliver long-term value to shareholders.
Stakeholders insist that the funds raised is expected to fortify the bank’s capital base, supporting its continued expansion and its ability to seize emerging opportunities in the financial sector.
The proceeds of the proposed Rights Issue would be used to support ongoing working capital needs including organic growth funding for its banking and other non-banking subsidiaries.
On March 28, 2024, the Central Bank of Nigeria (CBN) announced a two-year bank recapitalisation exercise, which commenced on April 1, 2024, and is expected to end on March 31, 2026. The recapitalisation plan set by the CBN requires minimum capital of N500 billion, N200 billion, and N50 billion for commercial banks with international, national, and regional licenses respectively.
Likewise, the CBN also raised capitalisation baseline for Merchant Banks (N50 billion) and Non-interest Banks (National: N20 billion and Regional: N10 billion). The options for the banks include private placement, which allows lenders to seek new funds from pre-selected private investors and rights issue, which authorises them to invite existing shareholders to purchase additional shares in the bank at a discounted price relative to the current market price, among others.
