The United Bank for Africa (UBA) Plc has announced that it will raise N239.4 billion through a Rights Issue of 6,839,884,274 ordinary shares of 50 kobo each at N35.00 per share.
UBA announced this in a statement on Thursday, November 14, 2024.
UBA said the Rights Issue, which will open on Friday, November 15, will allow existing shareholders the opportunity to purchase additional shares in proportion to their current holdings, adding that it is being offered based on one new ordinary share for every five existing ordinary shares held by shareholders, as of November 5, 2024.
In his letter to the shareholders informing them, the Group Chairman of UBA, Tony Elumelu, noted that following the resolution of the bank’s shareholders at the Annual General Meeting held in May 2024, authorising the establishment of the N400 billion Equity Shelf Programme, UBA will embark on a Rights Issue, as the first step in its broader capital raising programme.
“UBA’s Rights Issue aims to raise N239.4 billion, through the issuance of new Ordinary Shares to our shareholders. The primary objective of this Rights Issue is to further strengthen our capacity to take advantage of growth opportunities and sustain our leadership in the banking industry,” Elumelu said.
Explaining the use of proceeds, Elumelu stated that beyond regulatory compliance, the funds will expand UBA’s lending capacity, investment in digital infrastructure, support sustainable business practices, and expand the bank’s African operations.
Elumelu also highlighted how UBA is driving economic growth across Africa, saying: “Our historic partnership with the Africa Continental Free Trade Area (AfCFTA) Secretariat, where UBA pledged up to $6 billion in financing over the next three years to support eligible SMEs across Africa underscores our commitment to fostering economic development.”
The bank further stated that the issuance was in compliance with the revised minimum capital requirements for Nigerian commercial banks announced by the Central Bank of Nigeria (CBN) earlier this year.
It added: “UBA has consistently demonstrated growth and resilience, evidenced by the Group’s strong financial performance and recent recognition within the industry.
“UBA’s progressive dividend policy, which has seen an increase by 14.8% annualised dividend yield has demonstrated the Group’s ability to reward shareholders consistently.”
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