Nigeria’s first generation bank, Union Bank Nigeria Plc has announced, in a press release, that it has reached an agreement to sell a majority stake to Titan Trust Bank Ltd, in a deal estimated to be worth about N200 billion, though no purchase consideration was mentioned.
The deal will see existing core investors in Union Bank, Union Global Partners Ltd (64.98%), Atlas Mara (25.53%) and other shareholders divest their core holdings totalling 89.39% in Union Bank to Titan Trust Bank.
Titan Trust Bank, which commenced operations in 2019, is chaired by former Deputy Governor of the CBN and Chairman of Flutterwave, Tunde Lemo.
There had been speculations about sale of Union Bank, with the likes of Zenith Bank and Access Bank fingered as potential buyers.
But Titan Trust Bank has been confirmed as bank acquiring the 104-year-old bank, in a deal brings back memories of the acquisition of UBA by STB in the landmark deal of 2005.
Union Bank currently has a market valuation of N147 billion trading at a price to earnings ratio of 5.69x.
The bank has a net asset of N264 billion and a total asset of N2.56 trillion. The share price gained 10% today as investors who got wind of the deal loaded up the stock. Union Bank is down 5.3% in the last year.
Commenting on the deal, Union Bank Chairman, 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.”
Chairman of Titan Trust Bank, Mr. Tunde Lemo, on his part, 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.”