Diamond Bank Plc has concluded arrangements to raise N50.37bn via a rights issue, the bank said in a statement.
The company’s shareholders gave the approval to raise additional capital up to N50.37bn at its Annual General Meeting held on 24, April 2014.
A total of 8,685,145,863 Ordinary Shares of 50 kobo each will be offered to the Bank’s shareholders in the ratio of 3 new Ordinary Shares for every 5 Ordinary Shares held as at 13 June, 2014 at N=5.80 per share.
Final approvals for the registration and listing of the shares, from the Securities & Exchange Commission and The Nigerian Stock Exchange respectively are expected imminently. The Rights Issue is expected to on Wednesday, 30 July 2014 and close on Tuesday, 26 August 2014.
Stanbic IBTC Capital Limited (“Stanbic IBTC Capital”) is the Lead Issuing House while FBN Capital Limited (“FBN Capital”) is the Joint Issuing House to the Rights Issue.
At the Signing Ceremony held on Tuesday, 15 July 2014, the Group Managing Director of Diamond Bank, Dr Alex Otti, disclosed that the net proceeds of the Rights Issue will be applied towards the development of the Bank’s IT infrastructure, working capital support and the expansion and refurbishment of the Bank’s business locations.
Furthermore, the successful outcome of the Rights Issue should improve Diamond Bank’s tier 1 capital, thereby positioning it to take on bigger opportunities in the sector and ultimately increasing value for shareholders.
The Head of Stanbic IBTC’s Equity Capital Markets, Mrs Oyinda Akinyemi, commended the Management of Diamond Bank for their efforts towards ensuring that the Bank maintains its leading position in the sector and urged the Bank’s shareholders to seize the opportunity of the Rights Issue to show their confidence in the Bank’s potential for future growth.
The Executive Director, FBN Capital, Mr Taiwo Okeowo reiterated that the Bank has considerable potential for long term growth, given its market share of the growing retail banking sector and is a good investment opportunity for shareholders.
The Rights Circular for the Issue, which contains a Provisional Allotment Letter and the Application/Renunciation Form, will be dispatched directly to each shareholder before the Rights Issue opens.