Zenith Bank begins N290bn capital raise

‏‍Zenith Bank has started the process to raise N290bn fresh capital through rights issues and public offer, to bolster its expansion efforts.

The bank is issuing 5.23 billion shares at N36 each to existing shareholders and 2.77 billion shares at N36.50 each to the public.

This was disclosed by the Group Managing Director/Chief Executive Officer of Zenith Bank Plc, Adaora Umeoji, at the “facts behind the combined offer by Zenith Bank Plc” on Monday.

“We are offering approximately 5.23 billion units of shares of 50 kobo each at N36 per share to our existing shareholders through a rights issue of one new share for every six held. We are also offering 2.77 billion ordinary shares of 50 kobo each at N36.50 per share to the public through a public offer,” she noted.

Umeoji explained that 65 per cent of the shares would be allocated to existing shareholders through the rights issue, while 35 per cent would be available to the public through the public offer.

“We are very conscious of not diluting our existing shareholding structure, which is why we are offering 65 per cent to our existing shareholders and 35 per cent to the public,” she added.

She stated that a significant portion of the funds would be allocated to expanding its footprint in Africa and other regions, enhancing IT infrastructure, and supporting the real sector, with a strategic focus on launching operations in Paris to strengthen its presence in the African Francophone market.

“We currently have subsidiaries and representative offices in Ghana, Sierra Leone, Gambia, UK, UAE, and China, and we recently obtained a banking license to commence operations in Paris.

“We are going to leverage the Paris subsidiary to consolidate our business in the African Francophone region, starting from Cote d’Ivoire and Cameroun.

“We are very confident that after the ongoing recapitalisation exercise, the bank will experience exponential growth, and shareholders will get greater value for their investment,” she declared.

She said that 35 per cent of the funds raised would be allocated to expanding Zenith Bank’s footprint across Africa and other parts of the world and 20 per cent of the proceeds would be invested in enhancing Zenith Bank’s IT infrastructure and digital capabilities.

According to the Zenith Bank boss, the remaining 45 per cent of the capital raised will be deployed as working capital to support the real sector of the economy, with a particular focus on the retail and SME segments.

The Chief Executive Officer of Nigeria Exchange Group, Temi Popoola, highlighted the strategic importance of the capital raise, stating, “This initiative is aligned with our vision to expand our market presence and deliver superior value to our shareholders.”

Also, the Chief Executive Officer of Nigeria Exchange Limited, Jude Chiemeka, commended the bank for its corporate governance in driving the exchange to greater heights.

“It is important to know that Zenith Bank is listed on our premium board, and that means that they have high corporate governance and people who are international investors. There is a strong secondary market behind what the exchange does and the gain,” he said.