Bloomberg reportd Ecobank Transnational Inc. is considering selling a stake in its Nigerian subsidiary as part of a plan to raise about $500 million of equity for the unit.
1. It quoted the Chief Executive Officer as saying “It’s possible that could happen,” …. “There’s a board policy that we could, if we wanted, sell down and hold 75 percent in our subsidiaries.”
2. ETI, operates in 36 African and needs to increase the capital of Ecobank Nigeria, its biggest subsidiary, by March next year to meet new rules from the Central Bank of Nigeria.
3. A $500 million boost would take its capital-adequacy ratio to about 18 percent, above the minimum requirement of 16 percent, Jibril Aku, the managing director of Ecobank Nigeria Ltd., said on Nov. 14.
4. ETI has transferred to Ecobank Nigeria the “larger portion” of the $206 million in cash it received in October when South Africa’s Nedbank Group Ltd. bought a 20 percent stake in ETI, Essien said. The rest of Ecobank Nigeria’s capital needs will come from retained earnings and a “private placement” of equity, he said.
5. ETI’s rules prevent any institution from buying more than 24.99 percent of its shares and it prefers none to hold more than 20 percent to ensure a broad shareholder base, said Essien.
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