Union Bank sells UK Subsidiary to consolidate growth in Nigeria
Union Bank of Nigeria Plc today announced decision to divest of its subsidiary in the United Kingdom in order to focus on Nigeria’s market.
The management in a notice said that it has entered a share sale and purchase agreement to divest its 100% equity stake in Union Bank UK Plc.
Year to date, Union Bank share price has depreciated by 10 kobo. The Bank share was priced at the beginning of the year but closed at N5.90 Tuesday.
According the notice submitted to the Nigerian Stock Exchange, the management said the sale decision aligned with Union Bank’s strategy to geographically streamline its business operations to focus on growth opportunities in Nigeria.
Following a competitive bid process, MBU BidCo Limited, an acquisition vehicle wholly owned by MBU Capital Limited, has been selected as the preferred bidder.
However, Union Bank said that the completion of the sale is subject to regulatory approvals from the relevant regulatory authorities in Nigeria and the United Kingdom.
Commenting on the planned divestment, Emeka Emuwa, Chief Executive Officer of Union Bank, said:
“As the banking landscape shifts towards digital and agency banking to drive financial inclusion, the Nigerian market presents robust long-term opportunities for Union Bank.
“This divestment allows us channel our focus and capital towards mining those opportunities fully.
“Through the sale, we are better positioned to deliver greater value to the organization and its stakeholders as well as continue to build the future of banking in Nigeria.
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“The terms of the sale of UBUK delivers substantial value to our shareholders, while also entrusting its customers and trading partners to a high-quality financial services institution who will work with existing management to deliver a stronger and more profitable entity.”
Also, Mohammed Iqbal, Founder and CEO of MBU Capital commented:
“We are delighted to announce the acquisition of Union Bank UK (UBUK), subject to regulatory approval.
“We see a huge opportunity to build on UBUK’s strengths in international markets to create a new-style bank which is focused on the needs of UK and international SMEs and entrepreneurs.
“Many of these customers are seeking a bank which truly understands the needs of entrepreneurial, fast-growing businesses.
“We believe that our acquisition and vision for UBUK offers the potential for significant growth for the bank. We look forward to working with our new colleagues at UBUK to continue to service the needs of its clients.
“We also look forward to sustaining and deepening relationships with UBUK’s existing trading partners.”
In the deal, Union Bank said Chapel Hill Denham Advisory Limited acted as Financial Advisers while White & Case LLP and Udo Udoma & Belo-Osagie acted as its UK Legal Advisers and Nigeria Legal Advisers respectively.
These are in addition to Syndeo Capital Limited led by Mandeep Ahluwalia which acted as Advisers to MBU Capital with Akin Gump LLP as Legal Advisers and PwC as Financial and Tax Advisers.
Union Bank sells UK Subsidiary By Ogochi Ndubuisi
