Business
Access Holdings is raising N365 billion through a rights issue.
Access Holdings is raising N365 billion through a rights issue.
Access Holdings, a prominent financial institution in Nigeria, has recently unveiled ambitious plans to raise a staggering N365 billion through a rights issue. This move is part of a broader initiative to secure a combined capital raise of up to $1.5 billion through various financial instruments, including equity, quasi-equity, and debt issuances.
The primary objective behind this strategic decision is to bolster Access Holdings’ capital base, thereby providing the necessary support for its ongoing expansion efforts and enabling the company to capitalize on emerging opportunities within the financial sector.
The details of the planned capital raise were officially disclosed in a notice regarding an upcoming Annual General Meeting, which was disseminated through the Nigerian Exchange Group (NGX), underscoring the transparency and regulatory compliance of the company’s actions.
In the context of the rights issue, Access Holdings, also known as Access Corporation, will witness an expansion in its issued share capital from N17,772,612,811.00 to N26,658,919,216.50. This expansion will be facilitated by the issuance of an additional 17,772,612,811.00 ordinary shares, each valued at N0.50 Kobo and ranking pari passu with the company’s existing shares.
The capital raise through the rights issue is scheduled to take place on the dates and terms specified by the directors, following regulatory approvals. This strategic move is expected to provide Access Corporation with the necessary financial resources to navigate the competitive banking landscape, allowing for investments in technology, infrastructure, and human capital.
Furthermore, the Board of Directors seeks approval to launch a capital raising program of up to US$1,500,000,000.00, which may include the issuance of various financial instruments such as ordinary shares, preference shares, notes, bonds, or other instruments. The Board will determine the specifics of this program, including tranches, series, proportions, dates, rates, and terms and conditions, subject to regulatory approval.
Following the announcement of its fiscal year 2023 results, Access Holdings disclosed a total share capital of approximately N2.1 trillion, with retained earnings of about N715 billion and “other components of equity” totaling around N936.7 billion. The planned capital raise represents approximately 17% of the company’s total share capital, surpassing its current share capital and premium of N251.8 billion.
In response to these developments, the company’s share price experienced an uptick, closing at N24 on Wednesday, reflecting a 3.9% increase. This positive market response follows Access Holdings’ announcement of a profit after tax of N612.4 billion for the year ended 2023.
Access Holdings, with its subsidiaries operating across various African nations, remains focused on inorganic acquisitions as a key element of its growth strategy. The decision to raise capital underscores the company’s ambition to expand its footprint and strengthen its market presence across the continent, leveraging acquisitions to drive its growth objectives effectively.
