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Monday, September 26, 2022

Investors Fear Delisting, Execution as TGI Group, Aminu Yaro Emerge New Owners of Union Bank

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Investors are worrying about a possible delisting of Union Bank following its takeover by Titan Trust Bank, which is controlled by a private conglomerate TGI Group and a Northern businessman Aminu Yaro.

Yaro who sources tell MoneyCentral is often referred to as the Sarkin of Hausa in Lagos owns 9.07 percent of Titan Trust, other entities controlled by TGI Group own most of the rest (85.48%).

Tropical General Investments (TGI) Group is an international investment and holding company with diversified interests and investments across Africa, The Middle East, Asia and other emerging markets.

TGI’s investments focus on driving inclusivity and value addition using locally sourced raw materials, state-of-the-art manufacturing facilities and a highly skilled workforce to produce world class products that are consumed both locally and exported to global markets.

TGI brands in Nigeria include CHI Pharmaceuticals, Wacot, Titan Trust Bank and now Union Bank.

Sources tell MoneyCentral that the Central Bank of Nigeria should intervene to help keep Union Bank listed on the Nigerian Exchange Group, since it is systemically important and being taken over by a non-listed entity.

Union Bank had a market capitalization of N133.96 billion at the close of trading yesterday.

There is also the question of expertise of Titan Trust to execute the transaction and run and digest the much larger Union Bank. Titan Trust is a regional bank that had just about 110 staff at the end of 2020 financial year.

Titan Trust reported pre-tax profit of N2.93 billion for the 2020 financial year, compared to Profit before tax of N25.4 billion for Union Bank.

Union Banks Gross earnings were down 1.9 percent to N156.9 billion in 2020, while Titan Trust gross earnings stood at N8.55 billion in the same time period.

Cornelis Vink (MFR) is the Chairman of TGI Group.

The Board of Directors of Union Bank of Nigeria Plc yesterday notified shareholders that it has received a notification from Union Global Partners Ltd, (UGPL), the holder of majority shareholding in Union Bank) of the execution of a Share Sale and Purchase Agreement between UGPL, certain other existing shareholders of Union Bank (as Sellers) and Titan Trust Bank Limited (as Purchaser) for the sale of an aggregate 89.39% of the issued share capital of Union Bank held by the Sellers, to the Purchaser.

Completion of the Transaction is subject to obtaining applicable regulatory approvals and the fulfilment of certain conditions precedent.

Commenting on the transaction: Chair, Union Bank, Mrs. Beatrice Hamza Bassey said: “On behalf of the Board, we congratulate all the parties involved in reaching this phase of the transaction and the Board looks forward to supporting the next steps to ensure a seamless completion of the process following regulatory approvals. We are grateful to our current investors whose significant and consequential investments over the past nine years facilitated the transformation of Union Bank, one of Nigeria’s oldest and storied institutions. Today, the Bank is well-positioned with an innovative product offering, a growing customer base of over six million and consistent year on year profitability. This is a solid foundation for our incoming investors to build on as we move into a new era for the Bank.”

Chair, Titan Trust Bank, Mr. Tunde Lemo, OFR said: “The Board of Titan Trust Bank and our key stakeholders are delighted as this transaction marks a key step for Titan Trust in its strategic growth journey and propels the institution to the next level in the Nigerian banking sector. The deal represents a unique opportunity to combine Union Bank’s longstanding and leading banking franchise with TTB’s innovation-led model which promises to enhance the product and service offering for our combined valued customers.”

Chief Executive Officer, Union Bank, Mr. Emeka Okonkwo said: “This transaction marks a significant milestone in the journey of our 104-year old Bank. Whilst thanking our current investors for their unwavering commitment to the Bank over the years, we welcome our new core investor, TTB. We recognize the strategic fit between the two institutions and expect that this deal will deliver the best outcome for our employees, customers and stakeholders. We look forward to collectively writing the next exciting chapter for Union Bank.”

Chief Executive Officer, Titan Trust Bank, Mr. Mudassir Amray said: “After completing over two years of operations with aggressive organic growth, we are excited to have an opportunity for a significant leap forward in market share. UBN’s widespread presence, state of the art technology platform, quality staff and strong brand loyalty fits well with our synchronized modular strategy. We look forward to delivering superior results for the benefit of our staff, customers, shareholders, and stakeholders.”

Union Bank of Nigeria, PLC was established in 1917 and listed on the Nigerian Stock Exchange in 1971, Union Bank is a household name and one of Nigeria’s long-standing and most respected financial institutions. The Bank has a network of over 280 Sales and Service Centers across Nigeria.

Following recapitalisation in 2012 from new investors and a new Executive Management team, Union Bank has undergone an award-winning transformation programme to reestablish the bank as a leading provider of financial services in Nigeria.

Titan Trust Bank is the newest national commercial bank in Nigeria. It commenced operation in October 2019.

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