The Central Bank of Nigeria (CBN), says it has no objection to the merger agreement between Access Bank and Diamond Bank, advising the banks to proceed to obtain other necessary regulatory approvals.
In a letter dated December 17, 2018, addressed to the Managing Director/CEO of Access Bank and signed by Director of Banking Supervision, Mr. Ahmad Abdullahi, the apex bank advised Access Bank to obtain other necessary regulatory approvals for the merger.
Meanwhile, the Board of Directors of Diamond Bank in a statement yesterday, explained, “Diamond Bank expects the transaction to complete in the first half of 2019.”
“The Board of Diamond Bank believes that the merger is in the best interest of all stakeholders including, employees, customers, depositors and shareholders and has agreed to recommend the offer to Diamond Bank’s shareholders.
According to Diamond Bank, the proposed merger would involve Access Bank acquiring the entire issued share capital of Diamond Bank in exchange for a combination of cash and shares in Access Bank via a Scheme of Merger.
Based on the agreement reached by the Boards of the two financial institutions, Diamond Bank shareholders would receive a consideration of N3.13 per share, comprising of N1 per share in cash and the allotment of 2 New Access Bank ordinary shares for every seven Diamond Bank ordinary shares held as at the Implementation Date.
Commenting on the agreement, the Chief Executive Officer of Diamond Bank, Uzoma Dozie said: “The proposed combination with Access Bank will create one of Africa’s leading financial institutions.
On his part, the CEO of Access Bank, Herbert Wigwe said, “Access Bank has a strong track record of acquisition and integration and has a clear growth strategy.
“Access Bank and Diamond Bank have complementary operations and similar values, and a merger with Diamond Bank, with its leadership in digital and mobile-led retail banking, could accelerate our strategy as a significant corporate and retail bank in Nigeria and a Pan-African financial services champion.
Meanwhile, the Securities and Exchange Commission (SEC) has said it is waiting for formal application from the banks on the merger.
“Access Bank and Diamond Bank have both notified the commission and the general public. It is a notice to merge, they have not merged yet. SEC is awaiting their application on the matter. The SEC received on Monday, December 17, 2018, notice of intention by Diamond Bank & Access Bank to merge. The commission is currently waiting for their formal application,” SEC said in a statement.
At the close of trading on the Nigerian Stock Exchange (NSE) yesterday, while Diamond Bank Plc appreciated by 9.47 per cent from N0.95 to N1.04, Access Bank Plc went up by 9.40 per cent from N7.45 to close at N8.15.
Investors traded 70.984 million units of Diamond Bank Plc shares worth N72.643 million, while they exchanged 13.615 million units of Access Bank Plc for N108.550 million.