Recapitalisation: Union Bank shareholders get 21% stake

Existingshareholders ofUnion Bank of Nigeria Plc, one of the nine banks that were bailed out by the Central Bank of Nigeria (CBN) will own 21 per cent of the bank's shareholding at the end of its recapitalisation exercise.Addressing newsmen on behalf of senior and general management staff of the bank in Lagos on Friday, Deputy General Manager, Treasury, Abayomi Oluyomi, said under the arrangement, the core investor, African Capital Alliance Consortium (ACA) which would be investing $750 million would also be allotted 60 per cent of the bank's total shares, while the remaining 19 per cent shares will be allotted to the Asset Management Corporation of Nigeria (AMCON).Oluyomi explained that the choice of a consortium of core investor to inject fresh funds into the bank as against the options of merger and acquisition or nationalisation was to protect the interests of all the stakeholders, stressing that the disadvantages of other options far outweighed the advantages.Listing some of the benefits of the shareholders, he said that the recapitalisation would bring in international reputable companies as part shareholders, adding that some part of the existing shareholding would be salvaged and saved.'As you can see, this is the best arrangement that adequately protects the interests of shareholders, staff, customers and others. Unlike other arrangements where the shareholders either lost their investment or get a paltry sum, in our case they still own 21 per cent. This is certainly a good deal' he said.He noted that the core investor, ACA, would focus on adding value to the bank which would be beneficial to all stakeholders, noting that with the capital infusion by the core investor, AMCON and existing shareholders would make Union Bank one of the most liquid banks in the country.Oluyomi further explained that the bank will retain its brand, noting that the new investor would inject genuine fresh capital that would enable the bank sustain growth going forward.He however said with the recapitalisation of the bank, Pensioners Funds and Assets within Union Bank remained available as per the National Pension Commission (PENCOM) Act of 2004, adding that Union Bank Pensioners Association remains relevant in a growing organisation while the benefits, including medical remain in place.Other groups to benefit from arrangement are customers, saying there would be major improvement in the infrastructure services and technology to make banking experience easier and more enriching.
Click here to read full news..