Nigeria’s Access Bank Acquire Diamond Bank

By Kede Aihie
Nigeria’s Access Bank has announced acquisition of Diamond Bank. This acquisition will
create Nigeria’s largest banking institution. Access bank also plan to launch a $200 million
rights issue.
CEO of Access Bank, Herbert Wigwe said, “Access Bank has a strong track record of
acquisition and integration and has a clear growth strategy.
In a letter dated December 17, 2018, signed by Director of Banking Supervision, Ahmad
Abdullahi, from Nigeria’s apex bank, Central Bank of Nigeria (CBN), to the CEO of Access
bank. The apex bank said it had no objection to the planned acquisition.
Nigeria Stock Exchange (NSE), also reacted positively to the planned acquisition as the share
prices of both banks surged at the close of trading yesterday. At the close of trading on the
Nigerian Stock Exchange (NSE) yesterday, while Diamond Bank Plc appreciated by 9.47 per
cent from N0.95 to N1.04, Access Bank Plc went up by 9.40 per cent from N7.45 to close at
N8.15.
Investors traded 70.984 million units of Diamond Bank Plc shares worth N72.643 million,
while they exchanged 13.615 million units of Access Bank Plc for N108.550 million.
According to Diamond Bank, the planned acquisition by Access Bank Plc will be finalised by
mid-2019.
The Board of Directors of Diamond Bank in a statement, said “Diamond Bank expects the
transaction to complete in the first half of 2019.” According to Diamond Bank, the proposed
merger would involve Access Bank acquiring the entire issued share capital of Diamond
Bank in exchange for a combination of cash and shares in Access Bank via a Scheme of
Merger.
Diamond Bank shareholders would receive a consideration of N3.13 per share, comprising of
N1 per share in cash and the allotment of 2 New Access Bank ordinary shares for every seven
Diamond Bank ordinary shares held as at the Implementation Date.
“The offer represents a premium of 260 per cent to the closing market price of N0.87 per
share of Diamond Bank on the NSE as of December 13, 2018, the date of the final binding
offer. “Immediately following completion of the merger, Diamond Bank would be absorbed
into Access Bank and it will cease to exist under Nigerian law.
“The current listing of Diamond Bank’s shares on the NSE and the listing of Diamond
Bank’s global depositary receipts on the London Stock Exchange will be cancelled, upon the
merger becoming effective.  Chief Executive Officer of Diamond Bank, Uzoma Dozie said:
“The proposed combination with Access Bank will create one of Africa’s leading financial
institutions.

Author: nmmin

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