UBA to Raise N239.4 Billion via Rights Issue to Strengthen Growth and Leadership
United Bank for Africa (UBA), Africa’s Global Bank, has announced plans to raise N239.4 billion through a Rights Issue. The bank will issue 6,839,884,274 ordinary shares of 50 kobo each at N35.00 per share. The Rights Issue opens today, offering existing shareholders the opportunity to purchase additional shares in proportion to their current holdings. The offering is based on a one-for-five ratio of new shares for every five existing shares held by shareholders as of November 5, 2024.
Strategic Move for Growth and Expansion
In a letter to shareholders, UBA Group Chairman Tony Elumelu explained that the Rights Issue is part of the bank’s broader capital raising strategy, following a shareholder resolution at the May 2024 Annual General Meeting that approved the establishment of a N400 billion Equity Shelf Programme. Elumelu emphasized that this Rights Issue is the first step in UBA’s plan to strengthen its position as a leader in the banking sector.
“UBA’s Rights Issue aims to raise N239.4 billion to support our strategic objectives, including expanding our lending capacity, enhancing digital infrastructure, promoting sustainable business practices, and driving growth across Africa,” Elumelu said.
Strengthening UBA’s Capacity for Growth
The proceeds from the Rights Issue will be used to boost UBA’s lending capacity, support digital innovation, and expand its footprint across the continent. The bank will also use the funds to comply with the revised minimum capital requirements set by the Central Bank of Nigeria (CBN) earlier this year.
Elumelu further highlighted UBA’s commitment to economic growth in Africa, citing the bank’s historic partnership with the African Continental Free Trade Area (AfCFTA) Secretariat. UBA has pledged up to US$6 billion in financing over the next three years to support eligible SMEs across Africa, reflecting the bank’s dedication to fostering economic development on the continent.
Impressive Financial Performance and Industry Recognition
UBA’s robust financial performance and consistent growth are evidenced by the bank’s recent awards and recognitions. In the 2023/2024 period, UBA won “Bank of the Year” awards in eight of its subsidiaries across Africa, including Cameroon, Chad, Ghana, Côte d’Ivoire, Mozambique, Republic of Congo, Sierra Leone, and Tanzania. The bank was also recognized with the Regional Award for Africa. Additionally, in 2024, UBA was named World Best Frontier Markets Bank and Best SME Bank in Africa.
Rights Issue Application Process
Shareholders can apply for the provisional allotment of the new ordinary shares exclusively through the NGX e-offer portal during the offer period. Existing shareholders may also apply for additional shares beyond their provisional allotment as outlined in the Provisional Allotment Letter. UBA customers are encouraged to access their Rights via the bank’s internet banking and mobile banking platforms for added convenience.
Conclusion
Through this Rights Issue, UBA aims to reinforce its leadership in the banking industry, expand its operations, and contribute to Africa’s economic growth. The successful completion of the offering will provide the bank with the resources needed to continue delivering value to shareholders and advancing its strategic objectives across the continent.