Article Summary
- As consideration for the transfer of the Scheme Shares, each holder of the Scheme Shares shall receive N7.00 per share transferred.
- Conditional upon the Scheme becoming effective, the Bank’s shares shall be de-listed from NGX.
- Titan Trust Bank Limited, the majority shareholder in Union Bank, has informed Union Bank that it, its nominees, associates, related parties, or other parties acting in concert, will not exercise its right of voting at the Court-Ordered Meeting.
Union Bank Plc has received a Federal High Court order to convene a meeting to consider and if thought fit, approve (with or without modification) a Scheme of Arrangement between Union Bank of Nigeria Plc and the holders of its fully paid ordinary shares.
This was contained in a notice of court order meeting obtained by Nairametrics.
According to the statement, the meeting will be held on the 13th of June 2023 at The Shell Hall, MUSON Centre, 8/9 Marina, Onikan, Lagos, at which place and time all the aforesaid shareholders are requested to attend.
Nairametrics reported recently that Union Bank Plc received an offer from its core shareholder Titan Trust Bank Limited to acquire the shares of all minority shareholders in Union Bank.
The bank noted that the transaction will be implemented by way of a Scheme of Arrangement between the Bank and the Bank’s shareholders (the Minority Shareholders), in accordance with the provisions of Section 715 of the Companies and Allied Matters Act 2020 (as amended).
It stated that under the terms of the Scheme, the Scheme Shares, being the outstanding shares of the Bank not already held by Titan Trust, will be acquired by Titan Trust for consideration of N7.00 per share.
Sub-joined resolution
According to the court order, at the meeting, the following sub-joined resolution will be proposed and if thought fit passed as a special resolution of the Bank:
- “That the Scheme of Arrangement dated the 10th day of May 2023 be and is hereby approved and that the Directors be and are hereby authorized to consent to any modification of the Scheme of Arrangement that the Federal High Court shall deem fit to impose or approve. “To give effect to the Scheme subject to such modification, addition and condition agreed between the Bank and Holders of its Ordinary Shares and/or approved or imposed by the Court: The Scheme Shares (as defined in this Scheme Document) be transferred to Titan Trust Bank Limited, and the holders of the Scheme Shares be paid the Scheme Consideration (as defined in this Scheme Document) by Titan Trust Bank Limited for the transfer of the said Scheme Shares.
- “That as consideration for the transfer of the Scheme Shares, each holder of the Scheme Shares shall receive N7.00 (Seven Naira) per share transferred.
- “That Nigerian Exchange Limited (NGX) and Central Securities Clearing System Plc (CSCS) shall be notified and requested to terminate trading in the shares with effect from the Eligibility Date and no trading or transfer of the Bank’s shares shall be registered after that date.
- “That conditional upon the Scheme becoming effective, the Bank’s shares shall be de-listed from NGX on the Eligibility Date, and following that date, all the share certificates representing the interests of the Scheme Shareholders (as defined in the Scheme Document) shall be deemed to be dematerialized and in the case of dematerialized shares, all the shares of the Bank that were lodged with the CSCS shall be transferred to Titan Trust.
- “That the Board of Directors of the Bank be and is hereby authorized to take all necessary steps and to consent to any modifications of the Scheme of Arrangement that the Federal High Court or the Central Bank of Nigeria or the Securities and Exchange Commission may deem fit to impose or approve, or that may otherwise be required”.
Voting
According to the statement signed by Somuyiwa Sonubi, the Company Secretary, Union Bank, by the said Order, the Court has appointed the Chairman of the Board of Directors, Mr. Farouk Mohammed Gumel, or failing him, any other director appointed in his stead by the shareholders present at the meeting to act as Chairman of the said meeting and has directed the Chairman to report the results thereof to the Court.
- “Voting at the meeting will be by poll. Shareholders may vote in person, or they may appoint another person, whether a shareholder or not to attend and vote in their stead. In compliance with the requirements of the Nigerian Exchange Limited, Titan Trust Bank Limited, the majority shareholder in Union Bank, has informed Union Bank that it, its nominees, associates, related parties, or other party acting in concert, will not exercise its right of voting at the Court-Ordered Meeting.
- Thus, Titan Trust Bank Limited will not be voting at the Court-Ordered Meeting. The Qualifying Shareholders may submit questions on the Scheme to the Bank before the date of the Court-Ordered Meeting. All such questions must be submitted to the Company Secretary via email to CompanySecretaryUBN@unionbankng.com not less than 24 (twenty-four) hours before the time appointed for the Court-Ordered Meeting.
- Shareholders sending in their questions will be required to provide the following details along with their questions: full name as provided during the purchase of the share(s), phone number, and email address (if available)”.
The company noted that the Scheme of Arrangement will be subject to the subsequent approval of the Court.
What you should know
Union Bank Plc last year announced the completion of core investors’ sale of a majority shareholding to Titan Trust Bank Limited, a subsidiary of TGI Group.
This was just as the bank announced board changes that resulted from the resignation and subsequent retirement of the Directors from the Board of Union Bank and the appointment of new directors. The statement further said:
- “Following Union Bank of Nigeria Plc’s notification in December 2021 of the execution of a Share Sale and Purchase Agreement (SSPA) between the Bank’s majority shareholders – Union Global Partners Limited, Atlas Mara Limited, et al. – and Titan Trust Bank Limited (TTB), and the subsequent receipt of all necessary regulatory approvals, Union Bank hereby notifies Nigerian Exchange Limited (NGX), the Securities & Exchange Commission and members of the public of the completion of the transaction under the SSPA, which effectively transfers 93.41% of Union Bank’s issued share capital to TTB.
- “Consequently, in compliance with NGX, Rulebook and the Amendments to the Listing Rules, Union Bank hereby notifies NGX, our esteemed stakeholders, and the investing public of the following: ‘Union Bank hereby notifies NGX that with the completion of the transaction, TGI Group, parent of TTB, now becomes the majority shareholder and core investor in Union Bank.
- “Union Bank hereby notifies NGX of the completion of the divestment of the Bank’s entire shareholding interest (direct and indirect) in its subsidiary, Union Bank (UK) Plc (“UBUK”), to all the shareholders in the Bank’s records as of 4th March 2022, pro rata to their existing shareholding interests in the Bank. Consequently, UBUK is not included in the transaction with Titan Trust Bank”.
My concern is how the minority interest with the new arrangement would be effectively protected from the new arrangement with Titan Trust Bank? Past delisting from the Nigerian Stock Exchange has become frustrating to the minority shareholders. The Security Exchange Commission should look into the welfare of the minorities interest in all the delisting companies from the NGX. There are instances where funds meant to be released to the minority shareholders are yet to be released to them for the past five years. These companies will not reply to emails to them about their unpaid funds. Before approval is granted for delisting from the NGX the interest of the minority shareholders must be protected. N7.00 that is being recommended by Titan Trust Bank to the minority shareholders should be reviewed upward. Undoubtedly, losses are expected to be made by certain minority shareholders. For example, I once bough Union Bank Plc for N14.00 per share. There are minority shareholders who had paid more than that per share when the going was okay with the bank. The Security Exchange Commission should show more interest in the protection of the minority in a situation like delisting.
Dear Agabah Frank, please be informed that your e-mandate form has been approved. We will forward the form to your bank and notify you accordingly.
Thank you.
Hello Sir, please be aware that I have not heard from you since you sent me the above email. I have not received any information from my bank regarding my shares with Union Bank. Please let me know the status of my account.