Zenith Bank Plc, a leading financial institution in Nigeria, has announced its intention to raise N290 billion in capital through a combination of rights issue and public offer. This strategic move is aimed at further strengthening the bank’s capital base and positioning it for sustained growth and expansion.
Zenith Bank Plc intends to raise N290 billion through a combination of a rights issue and a public offer to comply with the revised minimum capital requirements for Nigerian commercial banks introduced by the Central Bank of Nigeria (CBN). This announcement was made during the Zenith Bank rights issue/public offer signing ceremony held yesterday in Lagos.
This event marked a significant milestone in the bank’s
previously announced capital-raising program, aimed at strengthening its
capital base and supporting its growth trajectory across its banking and
non-banking subsidiaries.
The rights issue offers 5,232,748,964 ordinary shares of 50 Kobo each at N36 per share, while the offer for subscription presents 2,767,251,036 ordinary shares of 50 kobo each at N36.50 per share.
The rights offering provides current shareholders the chance
to acquire additional shares in proportion to their existing holdings. The
offering is made on the basis of one new ordinary share for every six existing
ordinary shares held as of Wednesday, July 24, 2024.
Conversely, the public subscription offering is available to
the general public and aims to attract new investors.
At the signing ceremony, the Group Managing Director and
Chief Executive Officer of Zenith Bank Plc, Dr. Adaora Umeoji, OON, conveyed
her excitement regarding the rights issue and public offer, “Today, we
signed the transaction documents with
respect to Zenith Bank’s N290 billion rights issue and public offer. This is
slightly above the N230 billion required for us to meet the CBN’s minimum
recapitalisation requirement.
“We are extremely pleased with the level of enthusiasm we
have already seen from our existing shareholders for the rights issue. Beyond
existing shareholders, incorporating a public offer is crucial to ensure that
our customers, who are not yet shareholders, can have the opportunity to join
in the ownership of this premium brand.
“In terms of Tier-1 Capital, Zenith Bank has been adjudged
by The Banker, Financial Times to be number one in Nigeria and the only
Nigerian Bank in the top 600 banks globally. Over the years, we have
consistently rewarded our esteemed shareholders. “Specifically, in the last
five years, we have maintained the record as the highest dividend-paying Bank
in Nigeria. In 2023, we set a record as the only Nigerian Bank to pay a
dividend of N4 per share.” She added that the proceeds from the capital raise
would be channelled towards expanding banking operations across Africa and
internationally, investing in technology infrastructure, and supporting working
capital on an ongoing basis.
She conveyed a positive outlook, expressing confidence that
Zenith Bank’s history of profitability and consistent wealth creation for
shareholders will ensure the success of the capital raise. Prospective
investors were assured of Zenith Bank’s commitment to maintaining its
leadership in dividend payout in the coming years, encouraging them to make
value-driven investments in the bank.
She also extended heartfelt gratitude to the visionary
Founder and Chairman, Dr. Jim Ovia CFR, whose foresight over three decades ago
laid the foundation for a reputable, dominant, and globally recognized
financial institution renowned for innovation, superior performance, and the
creation of premium value for all stakeholders.
The CEO of Stanbic IBTC Capital Limited, Mr. Oladele Sotubo,
praised Zenith Bank’s management for their dedication to the transaction. This
transaction presents an opportunity for current shareholders to strengthen
their positions and invites new investors to join Zenith Bank’s journey into
the future.
He also expressed appreciation for the chance for Stanbic
IBTC Capital Limited to lead and oversee the execution of these transactions.
In addition, he stated that the combined offering of a
rights issue and a public offer underscores Zenith Bank’s position as an
industry leader and a benchmark for the capital market, which is likely to
stimulate further transactions in the market.
The lead issuing house for the rights issue and public offer
is Stanbic IBTC Capital Limited. The joint issuing houses include Quantum
Zenith Capital & Investments Limited; CardinalStone Partners Limited;
Meristem Capital Limited; Chapel Hill Denham Advisory Limited; Coronation
Merchant Bank Limited and Vetiva Advisory Services Limited. The offer will
commence on Thursday, August 1, 2024, and conclude on Monday, September 9,
2024.
“Zenith Bank offers a comprehensive range of platforms for
the rights issue and public offer. Applications can be conveniently made
through various electronic channels, including Zenith Bank Internet Banking,
Mobile Application, Corporate Internet Banking, nationwide branches, and the
NGX Invest platform.
“The Zenith Bank E-Application channels have been integrated
into the NGX Invest platform, accessible at https://invest.ngxgroup.com. These
channels are available to all applicants and authorized receiving agents for
submitting applications on behalf of applicants. This electronic platform
democratizes the distribution of public offers and rights issues in the capital
market, allowing investors to subscribe conveniently with just a few clicks, as
stated by the bank