Access Bank Plc will be holding an Extra Ordinary General Meeting (EGM) on Friday, February 1, 2019, at 10.00 a.m. The bank disclosed this in a notice sent today to the Nigerian Stock Exchange.
Agenda of the meeting is to obtain shareholders approval to raise additional equity by way of a rights issue to the tune of N75 billion.
The rationale behind the proposed issue
Group Managing Director (GMD) of Access Bank, Herbert Wigwe at a press briefing yesterday had stated that the proposed rights issue, was to serve as an additional capital buffer, post-merger with Diamond Bank
The reason is to make sure that even though we have more than enough capital today, the emergent entity will have the strongest capital base to support an entity of that nature.
The two banks had earlier this week, announced a planned merger. This came barely few weeks after denials were issued.
Here are highlights of the proposed resolutions in the EGM notice.
- That the Bank’s Authorised Share Capital be and is hereby increased from NGN20 billion to N35 billion by the creation of 30,000,000,000 (Thirty Billion) Ordinary shares of 50 (Fifty) Kobo each.
- That the Directors be and are hereby authorized to raise additional equity capital of up to a maximum of NGN75,000,000,000.00 (Seventy-Five Billion Naira) by way of a Rights Issue, subject to obtaining the approvals of the relevant regulatory authorities.
- That the shareholders, hereby waive their pre-emptive rights to any unsubscribed shares under the Rights Issue in the event of an under-subscription.
- That the Directors of Access Bank be and are hereby authorized by way of a Placing and subject to obtaining all requisite regulatory approvals, to offer to Diamond Bank shareholders shares in Access Bank to be purchased after the Implementation Date on the same term as the Rights Issue and in the same proportion that they would be entitled to as if they had already become shareholders of Access Bank.
This is in the event of the rights issue taking place before the merger of the two banks, and subject to regulatory approval.
Access Bank is currently trading at N7.65, down 3.16%
