Otedola takes control of FirstHoldco in N324bn deal as Otudeko, Hassan-Odukale exit

Billionaire investor and business magnate, Femi Otedola, has taken control of First Bank of Nigeria Holdings Plc (FirstHoldco) in a landmark N324.47 billion share deal that marks the culmination of months of strategic moves and boardroom intrigues.

Otedola, who previously held a 15 percent stake in the 130-year-old financial institution, upped his equity to approximately 40 percent through the acquisition of 10.47 billion shares in a series of off-market block trades executed on the floor of the Nigerian Exchange Limited (NGX) on Tuesday.

The transaction effectively gives him majority control of Nigeria’s oldest bank, one long troubled by internal disputes, regulatory interventions, and management instability.

The mega deal signals the forced exit of Oba Otudeko, the bank’s former chairman and until recently one of its most influential shareholders, who was compelled to offload over 20 percent of his holdings in the holding company following a long-running dispute with the bank’s board and regulatory authorities. Otudeko, now aged 82, was reportedly given a choice between criminal prosecution over past corporate governance breaches and stepping aside with a negotiated payout.

The development marks the end of a turbulent era at FirstHoldco, which has in recent years been rocked by shareholder squabbles and regulatory scrutiny. Oba Otudeko’s tenure at the helm of the bank was marred by allegations of corporate malfeasance, particularly relating to insider lending and governance violations.

The Central Bank of Nigeria (CBN) had in 2021 intervened in the affairs of First Bank, removing the board of First Bank Nigeria Limited – its flagship subsidiary – over what the regulator described as “insider abuse” and “breakdown of governance.”

The core of the crisis stemmed from the controversial N456 billion loan facility extended to Honeywell Group, a company linked to Otudeko, which First Bank struggled to recover.

The CBN repeatedly instructed the bank to reduce its exposure to the group, culminating in a standoff between Otudeko and the apex bank. Although the matter was eventually resolved commercially, with Honeywell reportedly restructuring and repaying part of the loan, tensions between Otudeko and the bank’s leadership remained unresolved.

Otedola’s entry into the scene in 2022 changed the power dynamics. Initially acquiring a 5.07 percent stake in the holding company, the energy tycoon quickly grew his stake to 7.57 percent and later to 15 percent, positioning himself as the largest single shareholder. Sources within the bank say Otedola’s increasing influence was pivotal in the board’s decision to finally sideline Otudeko and revisit governance issues previously swept under the carpet.

Matters reached a head when the bank, under Otedola’s influence, allegedly prepared to criminalise Otudeko’s past conduct, with plans to institute legal action at the Federal High Court in Lagos. Faced with the threat of prosecution, Otudeko reportedly opted for a soft landing – relinquishing his stake in the holding company in exchange for an exit package now estimated at over N300 billion in cash, based on the off-market deal pricing.

Hassan-Odukale Family Also Exits

In a related development, the Hassan-Odukale family, another long-standing shareholder bloc in FirstHoldco, also sold down their stake in the bank. Market sources confirmed that the family disposed of 5 percent of their equity in the Tuesday trades, citing a desire to “seek shareholder value elsewhere.”

The transactions were executed at a negotiated price of N31.00 per share, compared to the bank’s closing price of N32.20, which rose by 9.9 percent on the NGX as news of the trades sent investor sentiment soaring. The size and structure of the transaction, spanning 17 negotiated block deals, pushed the market capitalisation of FirstHoldco past N1.44 trillion.

According to insiders, the trades were facilitated by First Securities Ltd, acting predominantly as the buyer, while sellers included CardinalStone Securities Ltd, Meristem Stockbrokers Ltd, Renaissance Capital (Rencap) Securities Ltd, Regency Asset Management Ltd, United Capital Securities Ltd, and Stanbic IBTC Stockbrokers Ltd. In some instances, First Securities was also listed as a seller, suggesting inter-account transfers or portfolio reshuffling.

These negotiated off-market trades are typically arranged privately between parties and reported post-factum to the Exchange. They do not impact daily trading volatility, but their size often sends signals of major strategic shifts.

With his new controlling stake, Otedola now faces the monumental task of turning around the fortunes of a bank that has long underperformed despite its legacy status. First Bank remains weighed down by non-performing loans (NPLs) estimated at nearly N1 trillion, much of it tied to legacy insider credit.

Even more pressing is the CBN’s recapitalisation mandate, which requires Tier-1 banks to raise N500 billion in new capital before a regulatory deadline of March 2026. FirstHoldco has already announced a rights issue worth N346 billion, but with the new shareholding structure, Otedola will need to drive the process forward and possibly inject another N154 billion to meet the full requirement.

Analysts say the recapitalisation effort is achievable, especially with Otedola’s financial muscle and strategic vision. However, they caution that failure to manage the bank’s NPL crisis and comply with the CBN’s directive to end regulatory forbearance could erode investor confidence once again.

For Otudeko, the transaction marks a dramatic and symbolic end to decades of influence over one of Nigeria’s oldest and most prestigious financial institutions.

While he leaves the stage with significant financial compensation, his legacy remains contested … hailed by some as a visionary who built industrial empires, and by others as emblematic of crony capitalism and insider control that plagued Nigeria’s banking sector for years.

In contrast, Otedola’s ascension is being viewed by the market as a positive sign for reform. Known for his strategic investments in energy, finance, and infrastructure, he is expected to bring managerial discipline and a profit-driven culture to FirstHoldco.

What happens next will depend on how quickly he consolidates his boardroom gains and translates them into operational excellence in a sector that is rapidly evolving and increasingly competitive.