Otedola acquires more FBN Holding shares, increases stake to 11.64%

Femi Otedola, the chairman of FBN Holdings, has once again increased his stake in the company, further cementing his position as the single largest shareholder of the financial services giant.

In a notice to the NGX, the billionaire confirmed that he had acquired an additional 797,946,415 shares of the company at an average price of N21.58. The transaction value of the new acquisition amounts to a staggering N17.2 billion.

This latest acquisition takes his combined stake to 11.64%, making him the only shareholder of the bank with a total shareholding exceeding 10%.

 

Just last week, Nairametrics reported that the billionaire had acquired N18.9 billion worth of shares, which increased his shareholding to 9.41%. The latest acquisition brings the total to N36.1 billion in a matter of days.

He now holds a combined 4.178 billion shares of the company’s total outstanding shares of 35.895 billion

Otedola’s acquisitions

According to Nairametrics’ findings, Femi Otedola, one of only four Nigerian billionaires listed by Forbes, has invested an estimated N102 billion since he began acquiring FBN Holdings shares three years ago.

• The pursuit of a majority stake in FBN Holdings has been a dynamic journey, beginning in October 2021 when Femi Otedola first announced that he had secured a 5.07% shareholding.

• Following this, in December 2021, Otedola increased his stake further to 7.57%, marking a significant leap.

• By mid-2022, Otedola reduced his stake to 5.24%, divesting approximately 30% of his shareholding in the group. However, he started acquiring shares in the bank again in 2023 as controversy over who owned the majority stake in the bank remained.

• After a review and confirmation by the Central Bank, only two shareholders stood out as having over 5% of FBN Holdings shares: Oba Otudeko’s Barbican Capital and Femi Otedola.

• At the end of the first quarter of 2024, Otedola’s shareholding in the bank was confirmed at 7.01%, up from 5.65% at the end of 2023, officially surpassing Otudeko as the single largest shareholder.

The latest acquisition now gives him a commanding 11.64% majority shareholding of the financial holding company.

What this means

Previously known for his vast investments in the energy sector, Otedola’s foray into the financial services space now makes him the only Nigerian billionaire (in dollars) to own a majority stake in a commercial bank in the country. He is also one of the single largest shareholders of any financial services company in Nigeria.

• The latest acquisition suggests the billionaire is now in effective control of the bank following months of internal shareholder positioning. The bank now has a new MD/CEO and a reconstituted board with him as Chairman.

• Otedola’s continuous acquisition of FBN Holdings stock suggests that the billionaire investor is very confident about the outlook of the bank and the financial services sector.

• His entire investment amounts to around 13% of the N759 billion market capitalization of the financial holding company. FBN Holdings hit an all-time high of one trillion in market cap earlier in the year as its share price surged in a bull market.

The bank is also expected to announce its own rights issue or public offer as it bids to attain the estimated N248.7 billion needed to meet its N500 billion minimum ordinary share capital requirement.

A likely rights issue could see the billionaire continue to increase his stake in the bank.