… new investor to control 8.59% shareholding post listing

Nigeria’s tier-two bank, Fidelity Bank Plc, has announced the result of the private placement transactions that took place in February 2023, indicating that a total of 3,037,414,308 ordinary shares of 50 kobo each were purchased by investors at N4.60 per share, the notice sent to the Nigerian Exchange Group (NGX) has shown.

A private placement is the sale of stocks, bonds or securities directly to high-net-worth individuals rather than through the public offering.

According to the bank, the private placement took place from February 22 to February 23, 2023. The offer received two applications for the shares offered for sale and were 100 percent subscribed. One of the successful applications opted to buy 287,414,308 ordinary shares and were allotted in full while the second application opted to buy 2.750 billion shares which were also allotted in full.

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“The Securities & Exchange Commission has cleared the Basis of Allotment stated above as well as this announcement. CSCS accounts of successful allotees will be credited with shares allotted, not later than Friday, May 05, 2023 by the Registrars to Fidelity Bank Plc, First Registrars & Investor Services Limited, No 2, Abebe Village Road, Iganmu, Lagos, Nigeria,” the bank said in a note to the NGX.

As of April 13, 2023, Fidelity Bank’s total shares outstanding stood at 28,974,797,023 with a market capitalization of N145.16 billion. When the new shares are added to the existing outstanding shares on May 5, its total shares outstanding will increase to 32,012,211,331, making the tier-two bank the fifth largest listed bank in terms of shares outstanding after the United Bank for Africa (UBA), 34.19 billion shares; Jaiz Bank, 34.54 billion shares; Access Group, 35.54 billion shares, and FBN Holdings, 35.89 billion shares.

Recall that Fidelity Bank indicated in its audited financial statement for 2021 that no single shareholder held the company’s shares in excess of five percent, the implication of the successful completion of the private placement is that it has changed the shareholding structure, as the new investor with 2.75 billion shares now controls 8.59 percent shareholding in the bank.

Fidelity Bank’s share price closed at N5.01 per share on April 13, 2023, representing a year-to-date price appreciation of 15.17 percent.