Timelines in Titan Bank’s shocking acquisition of Union Bank

Emerging details of the controversial acquisition by a small Titan Bank of the giant, Union Bank offer an interesting peep into the workings of banks and their controlling shareholders who the CBN special investigator says worked in concert with the former governor of the apex bank, Godwin Emefiele.

Our reporter who has been patching together trails of the many contacts between both parties, has now identified key timelines in the journey to the acquisition.

Although there had been prior clandestine contacts, the journey began formally on October 25, 2021 with a request from Titan Bank to the Central Bank pleading to be allowed to acquire Union Bank which was established in 1917 and became known as Barclays Bank in 1925.

In that letter requesting the approval to purchase Union Bank, Titan said the acquisition will be completed in four stages beginning with the acquisition of 91.5%n of the issues shares. This will then be followed by a mandatory tender offer, MTO for the remaining shares and then a buy-out of any shares that are not voluntarily sold on the MTO and finally the merger of Titan and Union Bank with Union Bank as the surviving entity.

Titan then disclosed that the transaction will be funded via a combination of debt and equity with the former coming by way of a $300m facility from Afexim bank and another $175m in equity from two existing shareholders of Titan Bank, Messrs Luxis International DMCC and Magna International DMCC.

BusinessDay can now disclose that on March 3, 2022, the Central Bank wrote to Titan offering a ‘no objection’, practically clearing the way for Titan to begin the humongous acquisition.

On June 3, 2022, Titan Bank wrote to the central bank to inform the apex bank that three days earlier, it paid off the selling shareholders of Union Bank.

Documents seen by our reporter showed that on October 14, 2022, Titan Bank wrote another letter to the Central Bank asking to be allowed to launch a mandatory take-over of Union Bank. This request was granted by the apex bank via a formal communication on October 24, ten days after the request for an MTO was received.

Then on November 2, 2022, Titan bank launches the mandatory take-over of Union Bank on the back of the CBN approval.

The special investigator said the physical addresses in Dubai claimed by the key investors in Titan Bank, Messrs Luxis International DMCC and Magna International DMCC could not be located after visits by officials from the Nigerian embassy in the UAE.

However, a meeting called between the directors of Union Bank, Titan Bank and the deputy Governor of the CBN in charge of financial system stability did not hold on the scheduled date of December 5, 2023 and has now had to be postponed.

Earlier Saturday, BusinessDay reported that the special investigator had told President Bola Tinubu that the former Central Bank Governor Godwin Emefiele was linked to the acquisition of both Union Bank and Keystone Bank and recommended that they be nationalisation by the government.

In a report seen by BusinessDay, the Special Investigator Jim Obazee noted that while officially Union Bank’ shareholder is said to be domiciled in the UAE, “it was found that these entities do not have physical presence in Dubai as claimed. This contravenes Section 3 (5) of the Banks and Other financial Institutions Act, 2020. Accordingly, they are not supposed to be allowed to operate or acquire a bank in Nigeria.”