Former chairman of FBN Holdings, Oba Otudeko is reported to be behind the over four billion shares of FBNH that were transacted on the NGX on Thursday, July 6th, 2023.
Nairametrics confirmed this from traders on the Exchange with knowledge of the transaction.
The trade has ratcheted up allegations over the validity of the trades considering that no single shareholder hitherto officially owned as many shares.
Cardinal Stone and Rencap handled the transaction which shocked capital market operators considering the size of the deal.
Nairametrics reported that trade is valued at about N76 billion and is one of the largest single trades recorded for the stock this year.
A press release explaining the trade is yet to be released on the NGX as of when this article was written.
FBNH has about 35.8 billion shares outstanding as of December 2022 audited accounts, thus around 12.2% of the shares were traded.
Shares sold to proxies: A source with knowledge of the transaction informed Nairametrics indicate the sale was to Barbican Securities Ltd.
Likely Motivation for sale: Another reliable source who pleaded anonymity suggests this may be connected to the pending Ecobank appeal at the Supreme Court over the implementation of liquidation proceedings against Honeywell Plc, of which Oba Otudeko was the majority owner.
Why Proxies? Another source who did not want to be mentioned by name postulated that the sale via proxies may have been motivated by the need to mask ownership.
On why so many shares were traded despite not being previously disclosed as significant shareholding, another expert explained that this is often done to avoid scrutiny from the central bank.
CBN Guidelines: According to Section 3 of the CBN’s Prudential Guidelines for Deposit Money Banks
This provision is for any director or shareholder with a stake of 5% or above raising concerns over market anomalies taking place on the NGX.
Regulators at the Security and Exchange Commission are also thought to be monitoring this transaction.
Checks by Nairametrics on the website of the NGX reveal no official statement is yet to be made by the bank holding company or anyone.
Former President of the Chartered Institute of Brokers (CIS) and the Managing Director of Arthur Steven Asset Management Limited, Mr. Olatunde Amolegbe in an exclusive chat with Nairametrics stated that FBN Holdings is one of the most liquid stocks in the nation’s stock market.
The Executive Vice Chairman of Hicap Securities Limited, Mr. David Adonri said that the over 4 billion units of FBN Holdings Plc shares have been traded on the NGX on Thursday was a strategic investment or divestment.
He noted that it may not be connected with the struggle for the soul of the organization.
About 30 million shares of the stock have been traded as of when this article was written. The bank’s share price is currently N20.20.
Culled fromNairametrics.
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