Diamond bank has confirmed its
merger with Access Bank Plc, stating that the development is in the best
interest of all stakeholders including, employees, customers, depositors and
shareholders.
In a statement signed by Chioma
Afe, Head, Corporate Communications of Diamond Bank, it was confirmed that the
proposed merger would involve Access Bank acquiring the entire issued share
capital of Diamond Bank in exchange for a combination of cash and shares in Access
Bank via a Scheme of Merger.
According to the statement, ”The
Board of Diamond Bank Plc (“Diamond Bank”) today announces that following a
strategic review leading to a competitive process, the Board has selected
Access Bank Plc (“Access Bank”) as the preferred bidder with respect to a
potential merger of the two banks (“the merger”) that will create Nigeria and
Africa’s largest retail bank by customers.”
It said that the Board of Diamond
Bank believes that the merger is in the best interest of all stakeholders
including, employees, customers, depositors and shareholders and has agreed to
recommend the offer to Diamond Bank’s shareholders. Completion of the merger is
subject to certain shareholder and regulatory approvals.
The proposed merger would involve
Access Bank acquiring the entire issued share capital of Diamond Bank in
exchange for a combination of cash and shares in Access Bank via a Scheme of
Merger. Based on the agreement reached by the Boards of the two financial
institutions, Diamond Bank shareholders will receive a consideration of N3.13
per share, comprising of N1.00 per share in cash and the allotment of 2 New
Access Bank ordinary shares for every 7 Diamond Bank ordinary shares held as at
the Implementation Date. The offer represents a premium of 260% to the closing
market price of N0.87 per share of Diamond Bank on the Nigerian Stock Exchange
(“NSE”) as of December 13, 2018, the date of the final binding offer.
Immediately following completion
of the merger, Diamond Bank would be absorbed into Access Bank and it will
cease to exist under Nigerian law.
The current listing of Diamond
Bank’s shares on the NSE and the listing of Diamond Bank’s global depositary
receipts on the London Stock Exchange will be cancelled, upon the merger
becoming effective.
‘Diamond Bank expects the
transaction to complete in the first half of 2019.
Uzoma Dozie, the Chief Executive
Officer of Diamond Bank also said: “The proposed combination with Access Bank
will create one of Africa’s leading financial institutions. There is clear
strategic rationale for the proposed merger and strong complementarities
between the two institutions. While Diamond Bank has pioneered Nigeria’s
largest technology-led retail banking platform, Access Bank is one of Nigeria’s
leading full-service commercial banks. Consolidation in the Nigerian banking
industry is an inevitable, natural progression in a sector where the gap
between Tier 1 and Tier 2 banks has been widening and scale has become
critical; where technology will disrupt the traditional business model while
enabling broader financial inclusion. The board of Diamond Bank believes that
the proposed combination of the two operations provides an exciting prospect
for all stakeholders in both businesses and will create a financial institution
with the scale, strength and expertise to capitalise on the significant opportunities
in Nigeria and sub-Saharan Africa more broadly.”
Also speaking, Herbert Wigwe, CEO
of Access Bank, said: “Access Bank has a strong track record of acquisition and
integration and has a clear growth strategy. Access Bank and Diamond Bank have
complementary operations and similar values, and a merger with Diamond Bank,
with its leadership in digital and mobile-led retail banking, could accelerate
our strategy as a significant corporate and retail bank in Nigeria and a
Pan-African financial services champion. Access Bank has a strong financial
profile with attractive returns and a robust capital position with 20.1% CAR as
at 30 September 2018. We believe that this platform, together with the two
banks’ shared focus on innovation, financial inclusion and sustainability, can
bring benefits to Access Bank and Diamond Bank customers, staff and
shareholders.”
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