By Ayomide Otitoju
Minority investors in Nigeria have expressed strong support for United Bank for Africa Plc’s (UBA) ongoing rights issue, which aims to raise N239.4 billion. The offering, which opened on November 15, 2024, involves 6.84 billion ordinary shares of 50 kobo each, priced at N35 per share. The issue, pre-allotted on the basis of one new share for every five shares held as of November 5, 2024, will close on December 24, 2024.
Investor groups have declared their intent to fully exercise their rights, citing UBA’s consistent shareholder-focused practices and history of value creation through dividends and capital gains.
Shareholder Leaders Praise UBA’s Track Record
Sunny Nwosu, Founder of the Independent Shareholders Association of Nigeria, praised UBA’s legacy of prioritizing shareholder interests.
“UBA has a proven track record of delivering value to shareholders. From dividends to key decisions, the bank has consistently shown its commitment to investors. This rights issue is a golden opportunity, and we are not only taking up our rights but also encouraging others to do the same,” Nwosu said.
A prominent shareholders’ activist, Adeleke Adebayo, described the rights issue as a strategic move that balances earnings potential with minimal dilution.
“UBA’s growth story is remarkable, backed by stable leadership and strong financial performance. I encourage shareholders to seize this opportunity to participate in the bank’s future success,” Adebayo stated.
Dr. Faruk Umar, President of the Association for the Advancement of Rights of Nigerian Shareholders, highlighted the bank’s record-setting interim dividend of N2 per share and its stellar performance over the past three quarters.
“UBA’s decision to offer this rights issue reflects the trust it has built with shareholders. Its subsidiaries, including Transcorp Hotels, United Capital, and African Prudential, are thriving under Tony Elumelu’s visionary leadership. I am confident the share price will rise after the offer,” Umar said.
Mobilizing Shareholder Support
Mrs. Bisi Bakare, National Coordinator of the Pragmatic Shareholders Association of Nigeria, commended UBA’s consistent dividend payouts over two decades and the inclusion of shareholders in its subsidiaries’ ownership.
“UBA is one of the few banks that offers investors benefits beyond dividends. Its subsidiaries’ successes have translated into added value for shareholders. This rights issue is well-timed, and I believe it will be highly successful,” Bakare remarked.
A Legacy of Shareholder Value
UBA has been a consistent performer in Nigeria’s banking sector, recently achieving a historic interim dividend payout. The bank’s ongoing rights issue is expected to strengthen its capital base, enabling further growth and expansion.
With widespread support from minority investors and shareholder groups, UBA’s N239.4 billion rights issue is poised for success, reinforcing its position as a shareholder-centric institution in the Nigerian financial landscape.
