Business Hilights
Tracking Nigeria's Headline Business News Online

Like defunct Diamond, Union Bank begins divestment from UK

More than one year after defunct Diamond Bank exited from United Kingdom banking space, another Nigerian financial institution, Union Bank of Nigeria Plc has entered a share sale and purchase agreement to divest its 100% equity stake in Union Bank UK Plc. (UBUK).

A brief released by the bank Tuesday in Lagos noted that the 100% share sale and purchase agreement is anchored on Union Bank’s strategy to geographically streamline its business operations to focus on growth opportunities in Nigeria.

The Bank averred that “Following a competitive bid process, MBU BidCo Limited (MBU), an acquisition vehicle wholly owned by MBU Capital Limited (MBU Capital), was selected as the preferred bidder.

“The completion of the sale is subject to regulatory approvals from the relevant regulatory authorities in Nigeria and the United Kingdom”.

Giving further insights on the planned divestment, Chief Executive Officer, Mr. Emeka Emuwa stressed that “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. 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.”

Corroborating Union Bank chief, Founder and CEO of MBU Capital, Mr Mohammed Iqbal, said “We are delighted to announce the acquisition of Union Bank UK, 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.”

Business Hilights gathered that Chapel Hill Denham Advisory Limited is acting as Financial Advisers while White & Case LLP and Udo Udoma & Belo-Osagie acted as UK Legal Advisers and Nigeria Legal Advisers respectively to Union Bank.

Also, Syndeo Capital Limited, led by Mandeep Ahluwalia is standing as Advisers to MBU Capital while Akin Gump LLP acts Legal Advisers and PwC as Financial and Tax Advisers in the UK exit deal.