Fcmb Group, A Leading Financial Services Provider In Nigeria, Is Planning To Raise A Total Of N110.9Bn From The Capital Market. The Company Aims To Secure This Significant Funding To Support Its Business Operations And Further Enhance Its Position In The Industry. The Move Demonstrates Fcmb Group’S Commitment To Strategic Growth And Expansion In The Nigerian Financial Market.

Kayode Tokede

On Tuesday, FCMB Group Plc launched its public offer with the aim of raising an additional capital of N110.9 billion. The bank plans to achieve this by issuing 15.197 billion shares at a price of N7.30 per share. This strategic move is in accordance with the capitalization requirements set by the Central Bank of Nigeria (CBN).

During the Facts Behind the Offer Presentation held at the Nigerian Exchange (NGX), Mr. Ladi Balogun, the Group CEO of FCMB, highlighted the bank’s comprehensive plan to raise up to N397 billion in additional capital. This plan includes the establishment of a Technology Holding Company by 2026.

Mr. Balogun explained that the first phase of the plan involves generating N150 billion through a public offering of 15.12 billion shares at a price of N7.30 per share, amounting to a total of N110.9 billion. Additionally, a private placement of approximately $40 million to $50 million is expected to be concluded by the end of this year, with conversion scheduled for the next year. The public offer will enable the bank to meet market demands swiftly while ensuring simplicity and speed in execution.

The second phase of FCMB’s plan includes selling minority interests in one or two of its subsidiaries, aiming to raise between N80 billion to N100 billion. This will bring the total capital raised to approximately N250 billion. By selling minority stakes, the bank aims to avoid over-diluting its shareholders and capitalize on the potential of its subsidiaries.

The final phase of the plan, set to take place by the end of 2025, will involve a private placement with identified potential investors. FCMB aims to have fewer than 50 billion shares in issue, specifically targeting around 45 billion shares. Despite the significant share issuance, the bank’s goal is to sustain and grow earnings per share for its investors.

The proceeds from this capital raise will primarily support business growth, with a focus on lending to key sectors such as agriculture, SMEs, and non-oil exports. FCMB believes these sectors are crucial for Nigeria’s development. Additionally, investments in technology will enhance cybersecurity, service quality, and reduce financial and environmental costs. The bank also plans to allocate significant funds to human capital development, ensuring a robust leadership pipeline within the organization.

During the presentation, Mr. Balogun explained the reasons behind choosing a public offering over a rights issue. He emphasized the need for a swift and simple process. Moreover, the decision to sell stakes in subsidiaries was a strategic move to maintain control over the bank while injecting capital without excessive dilution.

Jude Chiemeka, the CEO of NGX, expressed confidence in FCMB’s capital raising plans and acknowledged the efforts of the Exchange in ensuring a seamless process. He encouraged stakeholders and potential investors to utilize the NGX Invest platform to participate in the public offer.

NGX has been actively deploying technology to create a digital exchange and streamline the onboarding process for investors. This provides an opportunity for a young demographic of investors to easily participate in this offer and become part of the NGX family.