The N239.4 billion rights issue by United Bank for Africa (UBA) Plc has garnered significant interest from shareholders, marking a strong start for the pan-African banking group.
The offer consists of 6.84 billion ordinary shares of 50 kobo each, available to existing shareholders at N35 per share. Pre-allotted at a ratio of one (1) new share for every five (5) shares held as of November 5, 2024, the rights issue will remain open until December 24, 2024.
With UBA’s proven track record of prioritising shareholders’ interests and delivering consistent growth, the ongoing rights issue is poised to solidify the bank’s position as a leading investment choice for Nigerians and investors across Africa.
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Prominent shareholder groups across Nigeria have expressed overwhelming support, describing the offer as a golden opportunity to increase stakes in a bank that consistently delivers exceptional returns. UBA, which pays dividends twice annually, recently declared an interim dividend of N2 per share on its half-year results, making it the highest payout by any Nigerian bank and among the top three yields in the entire stock market.
Sunny Nwosu, founder of the Independent Shareholders Association of Nigeria (ISAN), described UBA as a dependable institution. He noted the bank’s resilience and its success across Africa and beyond. Urging shareholders to exercise their rights, he affirmed his commitment to acquiring additional shares, emphasizing UBA’s consistent prioritisation of shareholders’ interests.
Faruk Umar, president of the Association for the Advancement of Rights of Nigerian Shareholders (AARNS), commended the decision to undertake a rights issue, underscoring the bank’s trustworthiness. He highlighted UBA’s strong financial performance and record interim dividend as indicators of its solid standing and future potential.
Retail investors, who constitute a significant proportion of UBA’s nearly 280,000 shareholders, are actively participating in the rights issue. These minority shareholders, owning between one and 10,000 shares each, represent nearly three-quarters of the bank’s shareholder base. Efforts are underway to ensure every shareholder has fair access to the rights offer through nationwide sensitisation campaigns.
Shareholder leaders have praised UBA’s longstanding commitment to creating value for its investors. They highlighted the bank’s history of distributing capital gains and dividends, citing its unique decision in 2010 to unbundle its non-banking subsidiaries as standalone companies instead of selling them. This move, initiated after the Central Bank of Nigeria repealed universal banking licenses, allowed shareholders to gain stakes in these subsidiaries, which now generate regular dividends and have appreciated significantly in value.
Other shareholder activists, including Adeleke Adebayo and Moses Igbrude, echoed similar sentiments, describing the rights issue as well-structured and an opportunity to strengthen the bank’s earnings potential. They pointed to UBA’s phenomenal progress, stable leadership, and consistent value delivery to shareholders as reasons for their confidence in the offer.
Bisi Bakare, National Coordinator of the Pragmatic Shareholders Association of Nigeria, expressed optimism about the rights issue’s success, noting UBA’s history of rewarding its investors.
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She urged shareholders to seize the opportunity, emphasizing the bank’s investor-friendly policies, including its decision to make shareholders co-owners of subsidiaries like United Capital Plc, Afriland Properties Plc, and Africa Prudential Plc.
Boniface Okezie, National Coordinator of the Progressive Shareholders Association of Nigeria, highlighted UBA’s strong potential for capital gains and dividends. He praised the management’s efforts in maintaining cordial relations with shareholders, describing the rights issue as a win-win opportunity for investors.
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