VENTURES AFRICA – Wema Bank Plc, has secured a regulatory approval from the Nigerian Stock Exchange (NSE) and the Securities and Exchange Commission (SEC) to raise a proposed N35 billion ($222 million) special placing, through the issuance of 23.33 billion (23,333,333,334) ordinary shares of 50k each at N1.50 per share, with additional shares billed to be listed on the floor of the NSE later.
A statement from bank revealed that the approved special placing will help increase its shareholders’ fund to N40 billion ($253.8 million).
Wema bank had, in December 2012, announced plans to raise capital by way of a special placing with commitment from investors already secured to the tune of the N35billion offer size. The Bank expects to use the funds realized from the special placing to grow its business, invest in IT infrastructure and expand its operations.
“We have spoken to a number of investors and we have commitment from them; and when the time is right, we will make known these investors to the general public; and the fact is that the process we are going through is part of what we had lined up, and these funds will help us to go after the business the way we really want to do it,” Wema’s CEO, Segun Oloketuyi said at the bank’s board meeting in Lagos.
With this development, Oloketuyi said the bank is expected to complete the process of raising the required capital before April 30, 2013.
He explained that the completion of the placement process is in line with the bank’s repositioning process which began in December and it would help the bank compete more effectively by enhancing the quality of products and services being offered to its increasing customer base.
“We are trying to generate more capital for the business, which will mean an opportunity to do more; and basically, what this will do for us is to enable us to have more power and room to acquire more assets and improve our business activities, Oloketuyi said.
“The fact remains that we will be spending a little of the revenue from this placing on infrastructure, and most of it will be dedicated to boost our working capital, which means increased cash to do business,” he added.
The CEO expressed optimism that with the high interest and demand experienced by the bank, the placing will be fully subscribed.
On the bank’s quest to obtain a national banking licence that will enable it expand its scope of operations beyond the current geographical boundaries; Oloketuyi said the process of exploring available options to securing an National Banking License (NBL) from the Central Bank of Nigeria (CBN) will commence upon the completion of the special placing.
Arguably Nigeria’s longest surviving indigenous financial institution, Wema Bank maintains a broad client base whilst ensuring relations with different sectors of the Nigerian economy are impacted via its 130-branch network.