Market Melt down: Union Bank Suspends N301bn public offer
The board of directors of Union Bank of
Nigeria has directed that its hybrid of both public offer and rights issue
worth N301 billion, the biggest offer in the history of the stock market be
suspended till further notice.
In response to that, the Nigerian Stock
Exchange (NSE) Tuesday, lifted the technical suspension placed of the shares of
Union Bank Nigeria plc.
According to the NSE, the lifting of the
suspension will remain until the company is ready to proceed with its proposed
public offer.
At the close of trade today, the shares of
Union Bank plc recorded a transaction volume of 1,993,412 units in 51 deals.
The share price closed at N41.58 after losing 42 kobo.
A source inside the bank told Business Day
that the bank’s decision to suspend the offer was as a result of the meltdown
in the stock market.
It will be recalled that Ecobank
Transnational Incorporated, currently in the market to raise money had to
extend its offer period due to under-subscription.
The bank’s hybrid offers is expected to come
in two folds- the right issues of 1,117,650,000 billion ordinary shares of 50
kobo each at N35.00 per share and public offer of 7,300,435,466 billion
ordinary shares of 50 kobo each at N36.00 per share.
Speaking in Lagos during a pre-offer briefing, Barth Ebong,
the bank’s group managing director said the bank needs the fund in order to
meet new challenges that surfaced as a result of the recent consolidation
process.
He stated that the proceed from the offers
which is expected to be in excess of over N301 billion would be used to expand
the operational activities of the bank including branch network and offshore
opening, further upgrading of the bank’s ICT facilities to meet the rising
needs of the consumers, as well as provide robust working capital for the bank.
Source: Business Day News
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