Business
Fidelity Bank Seeks Approval and Listing of a Rights Issue of 3.2 Billion Ordinary Shares on NGX
Fidelity Bank Seeks Approval and Listing of a Rights Issue of 3.2 Billion Ordinary Shares on NGX
Fidelity Bank Plc, a leading financial institution in Nigeria, has taken a significant step towards bolstering its financial position and expanding its market presence. The bank has initiated the process of seeking approval and listing a rights issue of 3.2 billion ordinary shares on the Nigerian Exchange Limited (NGX). This move is part of Fidelity Bank’s strategic efforts to enhance its capital base and facilitate its future growth plans.
The rights issue, which is being facilitated by the reputable stockbrokers APT Securities & Funds Limited, involves the application for the approval and listing of 3.2 billion ordinary shares of 50 kobo each at a price of N10 per share. This development was revealed in the NGX’s weekly report, signaling the bank’s commitment to transparent and regulated financial operations.
Key Details of the Rights Issue
The Rights Issue is structured to offer one (1) new ordinary share for every ten (10) existing ordinary shares held by shareholders as of the close of business on Friday, January 5, 2024. The Qualification Date for the Rights Issue has been set for January 5, 2024, providing clarity and transparency to existing and potential shareholders.
Fidelity Bank’s Expansion Plans
This recent move by Fidelity Bank aligns with its broader strategic objectives, as the bank has previously signaled its intent to bolster its share capital. Notably, the bank had previously passed a resolution to increase its share capital from N16 billion to N22.6 billion. This resolution, which was adopted during an Extra-Ordinary General Meeting held virtually on August 11, 2023, lays the foundation for the upcoming public offer and rights issue.
Key Takeaways from the Extra-Ordinary General Meeting
1. Boost in Share Capital: Fidelity Bank’s decision to increase its share capital involves the creation of an additional 13.2 billion ordinary shares, each priced at N0.50, signaling a significant expansion in the bank’s capital base.
2. Capital-Raising Drive: In line with its growth strategy, the bank will initiate a public offer for up to 10 billion ordinary shares. Additionally, existing shareholders will have the opportunity to participate in a rights issue, allowing them to acquire 3.2 billion ordinary shares. Importantly, the rights issue offers an attractive ratio of one new share for every ten existing shares held by investors.
3. Board’s Empowerment: The resolutions passed during the EGM have empowered Fidelity Bank’s Board of Directors to allocate the newly issued shares, subject to regulatory approvals, thereby providing a clear roadmap for the implementation of the capital-raising initiatives.
4. Compliance and Due Diligence: Fidelity Bank is committed to upholding the highest standards of compliance and due diligence. The board has emphasized its dedication to adhering to regulatory protocols, timely submission of mandatory filings, and securing all necessary approvals to ensure a seamless execution of the capital-raising plans.
Strategic Growth and Market Expansion
Fidelity Bank’s decision to raise its share capital to N22.60 billion underscores the company’s strategic focus on exploring new avenues for growth and market expansion. By fortifying its financial position and capital base, the bank is well-positioned to capitalize on emerging opportunities and navigate the dynamic landscape of the financial industry.
In conclusion, Fidelity Bank’s pursuit of approval and listing of a rights issue of 3.2 billion ordinary shares on the NGX reflects the bank’s commitment to sustainable growth and value creation for its stakeholders. This strategic move not only enhances the bank’s financial resilience but also reinforces its position as a key player in Nigeria’s banking sector. As the bank progresses with its capital-raising initiatives, it is poised to unlock new possibilities and drive long-term value for its shareholders, customers, and the broader economy.
The forthcoming rights issue and public offer present an exciting opportunity for investors to participate in Fidelity Bank’s growth story, marking a significant milestone in the bank’s journey towards sustained prosperity and market leadership.
