Ecobank acquires Oceanic
Nigeria’s Oceanic Bank announced on Monday that pan-African lender Ecobank Transnational Incorporated (ETI) is purchasing it lock stock and barrel.
Oceanic Bank with be 100% subsumed within ETI, fulfilling the Central Bank’s mandate to capitalize before a September 2011 deadline. Oceanic is the fourth lender to reveal details of its recapitalization plans.
ETI will pay ?38.5 billion ($24m million) worth of its ordinary shares and ?16.5 billion in preference shares for 100% of Oceanic.
Shares will be divided between existing shareholders and AMCON – the state-owned asset management company. The deal is expected to be approved at a shareholder meeting on Sept. 27.
Oceanic’s official statement regarding the merger was as follows:
“ETI will own 100 percent of the share capital of Oceanic Bank, while existing shareholders of Oceanic and AMCON will become shareholders in ETI. Subsequent to this, ETI will merge Oceanic Bank with Ecobank Nigeria.”
The Federal government set up AMCON – a ‘bad’ bank last year to absorb non-performing loans in order to prevent a collapse of the financial sector due to billions of naira of these loans.
Oceanic and ETI ‘s merger agreement was signed in July, enabling Oceanic to be capitalized and preserving shareholder’s investments in the bank.
