Otedola: Shareholders and analysts expect FBNH share price to rise

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Nigerian shareholders and capital market analysts have forecast FBN Holdings Plc’s share price to rise as the fight for control of the interests of major investors in the company is expected to intensify.

FBN Holdings, in a statement released to the Nigerian Exchange Limited and the investing public on Saturday, said billionaire businessman Mr. Femi Otedola had acquired a 5.07% stake in the company through its representative, Calvados Global Services Limited.

Reports also revealed that the company’s chairman, Mr Tunde Hassan-Odukale, had acquired 1.92 billion shares, representing 5.36 percent of the issued share capital of FBN Holdings.

The President of the Association of Pragmatic Shareholders of Nigeria, Ms. Bisi Bakare, told our correspondent in a telephone interview that the situation involved a struggle for control of FBN Holdings and its subsidiary, First Bank Nigeria Limited.

“This is likely to have an impact on the share price in the days and weeks to come,” she said.

Enterprise Stockbrokers CEO Rotimi Fakayejo has said he expects demand for FBN Holdings shares to increase.

“It is certain that a rise in the share price would occur. I see a situation where the proxy accounts held by some of the directors will be converted to direct holding, ”he said.

Noting that the company would soon release its financial statements for the third quarter of 2021, Fakayejo said a positive result would be a catalyst to support the growth in the company’s market value.

FBN Holdings’s share price closed at N12.1 on Friday, up 61.33% from N7.55 on September 28, when its shares started to climb steadily.

It was the most traded share on the NGX floor during the previous week in volume terms with 626.888 million shares, representing 40.07% of the total number of shares traded.

Atlas Portfolios Limited research analyst Olaide Baanu also said his outlook for FBN Holdings was largely positive.

“First, with the sale of Oba Otudeko’s stake to Otedola, the bank’s non-performing loans will decrease. In addition, the sale of Airtel Africa Plc, of which FBNH is one of the high holding companies, will provide more liquidity for investments, ”he said.

Regardless of who owns a controlling stake in the company, he said, whether it is Odedola, Odukale or any other significant shareholder, FBN Holdings maintains good fundamentals.

Some industry observers, however, have expressed concern about the ongoing competition, which they believe could have effects on the company’s corporate governance.

Meanwhile, the president of the Bank Managers Association of Nigeria, Mustafa Chike-Obi, advised the directors of FBN Holdings to work with the holding’s new investor, Otedola, saying there was a need to welcome his investment.

Chike Obi, who is the chairman of Fidelity Bank Plc, said he would be happy to welcome a new investor in his bank’s shares.

He said: “The president (of FBN Holdings) has not said a word about the quitting. What we do know is that the individual (Otedola) bought shares because he thinks it is a good investment. My advice to directors is that you are lucky, you have an investor who sees value in your stocks. Welcome their investment and work with them. As the chairman of Fidelity Bank Plc, I would welcome an investor who sees value in my stocks and wants to put money in the bank. I would welcome the investor.

The BDAN chairman described media reports indicating a struggle for asset control among his main investors as mere speculation.

He said, “We should stop there. If there is a struggle for control it would emerge at the board meetings and the AGM and at this point we can relate stories. We all speculate.

He added: “I see newspapers reporting that he is the majority shareholder. No he’s not. Majority shareholder means having more than 51 percent. He may or may not be the main shareholder. What shows there is a struggle for control? The man bought stocks, they think the bank is undervalued in terms of stock prices and someone wants to buy it. I think a lot of bank stocks are undervalued.

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