Union Bank CEO Buys Additional Shares Amidst Acquisition Rumour

May 7, 2021
Union Bank of Nigeria New Logo

By Dipo Olowookere

The Chief Executive Officer (CEO) of Union Bank of Nigeria, Mr Emeka Okonkwo, has increased his stake in the company by buying additional shares.

This is coming amidst rumour that some financial institutions are interested in acquiring the tier-2 lender, including two Nigerian tier-1 banks, Zenith Bank and Access Bank.

There had been speculations in recent times that Union Bank would soon have a new owner and Zenith Bank and Access Bank have been in the picture, though there had been denials.

Just a while ago, Bloomberg reported that banks from Africa and the Middle East have shown interests in taking over the 49.97 per cent stake Atlas Mara Group has in Union Bank.

Atlas Mara has been working with Rothschild & Co. to consider options for its Union Bank stake, but no final decisions have been made and there’s no certainty the deliberations will lead to a transaction, the people said.

Business Post recalls that last month, Access Bank said it had a business deal with Atlas Mara for the acquisition of a 78.15 per cent shareholding its subsidiary, ABC Holdings Limited, has in African Banking Corporation of Botswana Limited (BancABC Botswana).

In the midst of these rumours, Mr Okonkwo believes whether Union Bank remains with Atlas Mara or not, Union Bank has a huge prospect in the Nigerian banking industry and it is a wise investment decision to increase his stake in the firm.

On Thursday, according to a disclosure from the lender, its CEO bought more stocks at a unit price of N4.90. He got an aggregate of 2,431,917 units.

Mr Okonkwo recently took over from the former CEO, Mr Emeka Enuwa and when he assumed office, he promised to deliver greater value to stakeholders of the bank, particularly the shareholders as he has been a part of the transformation team put together by his predecessor in the past eight years, which made it possible for Union Bank shareholders to be paid the first dividend in over a decade.

“Over the past eight years, a significant amount of work has gone into building the Union Bank we see today and I am glad to have been a part of this process,” he said when he was given the honour of sounding the digital closing gong at the Nigerian Exchange (NGX) Limited recently.

“As we move ahead, our focus remains to create greater value for all our stakeholders particularly our customers and shareholders,” the Union Bank CEO promised.

According to him, “We have a clear vision to be Nigeria’s most reliable and trusted partner and we will continue to drive customer acquisition and channel optimisation through reliable dig channels and self-service platforms.”

“We will also continue to provide compelling and innovative products to drive customer transaction growth and service delivery, whilst deepening our relationship with key stakeholders including NGX Group as we move towards our goal,” the banker assured.

Will Union Bank acquisition favour Access Bank and Zenith Bank shareholders?

An analyst at Renaissance Capital, Mr Adesoji Solanke, informed THISDAY that, “We don’t think it’ll be a transformational deal for Access or Zenith (Return-on-Equity dilutive for both), but could be a good way for the Middle Eastern banks to get a decent foothold in the market.

“We suspect getting the other private equity investor block to sell will be critical as we wouldn’t expect a strategic bank investor to desire a minority shareholding.”

Dipo Olowookere

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

Mr Olowookere can be reached via [email protected]

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