Connect with us

Billionaire Watch

Otedola Increases Stake in First Bank, Now Holds, 7.57 Percent in FBN Holdings

Published

on

Femi Otedola

The corporate industry is not immune to power tussle, as wealthy and influential people in different economic sectors go head to head with shares and stakes. Femi Otedola, the billionaire investor and the Chairman of Geregu Power Plant, has once again increased his stake in FBN Holdings (the parent company of First Bank) to 7.57 percent. This makes him the single largest majority holder in the bank, according to public disclosure of ownership.

Femi Otedola and Tunde Hassan-Odukale, the Chairman of First Bank and the Managing Director of Leadway Assurance Company Limited, have been in a sort of tussle concerning First Bank shares for quite some time.  Femi Otedola acquired 1.81 billion shares earlier in the year through his investment vehicle, Calvados Global Services Limited. However, the share acquisition was surprising as neither Otedola nor First Bank informed the Securities and Exchange Commission (SEC) or the Nigerian Exchange Group (NGX) during the acquisition process.

The possibility of Otedola taking over did not sit right with Tunde Hassan-Odukale and his supporters, as a letter later appeared online that Odukale was the largest shareholder in First Bank Holdings, but this claim was not supported by the financial statements released from 2020 to 2021.

The letter was quickly recognised as an attempt to push back Otedola, who was all out to own a sizeable chunk of the leading financial institution.

After reports that Otedola was set to take over and the letter claiming that Odukale has more than 5%, First Bank released its own report denying any such shareholder but later acknowledged that Otedola has revealed the number of his shares.

Later on, First Bank confirmed that both Otedola and Odukale were in possession of more than 5% controlling stake.

To be precise, Femi Otedola’s stake in FBN Holdings was 5.07 percent at the time. However, news started going around that Seye Kosoko, the company secretary had attributed Leadway Pensure PFA’s entire 2.11% stake in the bank to Tunde Hassan-Odukale in a letter forwarded to the Nigerian Exchange limited (NGX).

That would have taken Tunde Hassan-Odukale’s total shares to 5.36%, which would have made him the single largest shareholder in the company as it would have totaled higher than Femi Otedola’s stake which was at 5.07% at the time.

However, the National Pension Commission (Pencom) confirmed that any funds invested in First Bank Holdings by Leadway Pensure Ltd belong to the holders of Retirement Savings Accounts (RSA). This confirmation silenced any claims that Odukale owned a stake of up to 5.36%.

First Bank also went ahead to explain that it did not list Tunde Hassan-Odukale as a 5% holder, but divided and recorded his shares as 4.16% (direct, personal shares) and 1.2% for Leadway shares.

Naturally, holding a stake of more than 5% in a company like First Bank is likely to give one a sense of power and control given the numerous investors in the leading bank.

Otedola has been an active participator in the Bank’s dealings. In October, he placed on record that he had invested the amount of $30 million in the bank’s long-term debt instrument, which was classified as Tier II capital and which makes a vital portion of the bank’s capital base.

Otedola said he made the investment due to his faith in the Nigerian economy which he termed as resilient and with a bright future. He urged people to look into the future, stating that the security challenges plaguing the country will be resolved and the country will once again receive its glory status.

The power tussle is ongoing as both sides have made moves and responded to the moves of the ‘opposition’.

A report made on December 11 revealed that about 1.1 billion units of First Bank of Nigeria Holding shares had been exchanged in only four days. This suggests that the battle for control of the bank is still ongoing, with no end in sight. The data was gathered from the daily trade volumes that were recorded by the company on the Nigerian Stock Exchange’s trading engine.

The data shows that 128.8 million units were traded on Monday, with 364 million units coming on Tuesday. Wednesday saw the trade of 441.9 million units and Thursday witnessed 228.5 million shares traded.

The power tussle however took another turn on December 9, 2021. Femi Otedola announced in a letter addressed to the bank that he had acquired additional shares in the company which now gives him an ownership of 7.57% in the bank.

According to market operators, Otedola has the right to purchase additional shares from the secondary market if they are available in order to increase his holdings in the bank. However, a Spokesperson for the Nigerian Exchange Limited (NGX) stated that the NGX was not aware of the acquisition and was therefore unable to comment.

In the letter, it was seen that Otedola acquired these shares through his proxies Calvados Global Services, Primose Global Concept, Shetland Global, Wells Properties and Impetus Synergy. The letter read, “I have recently acquired additional shares in FBN Holdings Plc (the Company) which has brought my total stake to 7.57% of the issued shares capital of the company.”

After this acquisition, it has been revealed that Femi Otedola has now spent a huge amount of N44.8 billion on investment in FBN Holdings Ltd. Since he has announced the acquisition of 2.7 billion shares, the average price at which he has acquired the FBN Holding shares is N16.48 per share. In comparison, the share price closed at N11.6 per share yesterday.

This new purchase has formally solidified his status as the biggest shareholder of FBN Holdings, very well ahead of his biggest rival in the company, Tunde Hassan-Odukale who is the Chairman of First Bank. Tunde Hassan-Odukale and Femi Otedola have been going at each other since October, when the news of Otedola’s share acquisitions became public knowledge late in the month.

It would be interesting to see how Tunde Hassan-Odukale responds to Otedola’s new acquisition. Following the trajectory of the power tussle, it would be unsurprising to see Hassan-Odukale either announce some new shares or begin the process of acquiring additional shares. However, at the moment Femi Otedola remains the man witrh the title of biggest shareholder.

Continue Reading
Comments

Billionaire Watch

Dangote’s Fortune Skyrockets by $15.1 Billion to $27.8 Billion

Published

on

Aliko Dangote - Investors King

Aliko Dangote, Chairman of Dangote Industries, saw his net worth surge by $15.1 billion on Thursday to $27.8 billion, according to the latest Bloomberg Billionaire Index.

Before factoring in his Dangote Refinery, Dangote’s net worth was estimated at $12.8 billion.

“The Dangote Refinery outside Lagos is the largest single-train oil refinery in the world and one of the most complex, capable of processing most global crude types. It has the potential to transform Nigeria’s economy by making the country self-reliant for fuel. And it’s more than doubled his net worth to $27.8 billion,” Bloomberg reported.

According to Bloomberg, Dangote’s current net worth is the largest wealth increase among the top 500 billionaires listed on the index.

Commenting on the refinery in New York last month, the 67-year-old Dangote said, “I didn’t know what we were building was a monster. The pressure was coming from different directions, people confusing us, disturbing us every day with different media stories that it will never work, it will never work, it will never work.”

This year alone, the billionaire’s net worth grew by $12.7 billion.

Continue Reading

Billionaire Watch

Dangote Reflects on Textile Sector Failures: Billionaire Lost Billions Before Achieving Success

Published

on

Aliko Dangote - Investors King

Behind every great success story lies an often-overlooked tale of struggle, missteps, and lessons learned.

Africa’s richest man, Aliko Dangote, recently shared his untold journey of failure and financial loss during a keynote speech at the 2024 Manufacturers Association of Nigeria (MAN) summit in Abuja.

According to Independent.ng, Dangote opened up about a chapter in his career that saw billions of naira lost in Nigeria’s once-thriving textile industry—a venture that, despite his best efforts, ended in closure and significant setbacks.

Dangote, the Chairman of Dangote Group and a global business icon, revealed that his foray into the textile industry in the 1960s did not go as planned.

Reflecting on the experience, he explained how his company, Dangote General Textile Mills, invested billions in two textile mills—one in Kano and the other being Nigeria Textile Mill, an enterprise originally set up for the Western Region by political leader Chief Obafemi Awolowo.

At a time when the Nigerian textile industry was booming, Dangote had high hopes for the success of these mills.

“We massively invested billions at that time,” Dangote said, recalling the scale of the operations. His company had bought out the foreign shareholders of the Nigeria Textile Mill, aiming to capitalize on the growth of the industry.

However, the boom didn’t last, and the lack of supportive government policies spelled doom for Dangote’s textile ventures.

Dangote explained that the government’s failure to protect the sector through consistent and effective policy decisions ultimately led to the collapse of both textile plants.

“We had to shut both the two factories,” he said, attributing the downfall to a combination of unfavorable conditions and a government that was unable to shield the industry from economic pressures.

The situation worsened when it came to paying the pensions and gratuities of employees who had been with the textile mills for decades.

Dangote noted that many of the workers had been employed for 25 to 30 years, creating a massive financial burden for the company.

Facing these enormous costs, he was forced to sell Liberty Merchant Bank, another one of his business ventures, to cover the debt. “Luckily for us, somebody came and said he wanted to buy our bank, Liberty Merchant Bank,” Dangote explained.

The sale of Liberty Merchant Bank brought in N1.2 billion, but this financial relief was short-lived. “After cashing out N1.2 billion, the industry consumed N985 million to pay pensions and gratuities just to get out of the business,” Dangote revealed.

The losses from the textile industry were devastating, leaving him to admit that his company had “burnt its fingers” in the process.

Despite encouragement from former President Olusegun Obasanjo to re-enter the textile industry years later, Dangote declined, citing the trauma of his previous experiences.

“I told him, ‘No, I will not go back there,’” Dangote said.

The billionaire’s candid recounting of these struggles serves as a reminder that even the most successful entrepreneurs face setbacks on their journey to success.

His willingness to share these hardships offers valuable insights for other aspiring business leaders, especially in emerging markets like Nigeria, where industries can be unpredictable, and policy shifts often complicate growth efforts.

Though the textile industry didn’t yield the results Dangote had hoped for, his resilience and ability to learn from failure allowed him to shift focus to other sectors.

Today, the Dangote Group is a leading conglomerate with investments spanning cement, sugar, salt, and petroleum, among others.

Dangote has solidified his place as one of Africa’s wealthiest men, a testament to his determination to succeed in adversity.

Continue Reading

Billionaire Watch

Masayoshi Son Loses $2.6 Billion as SoftBank Shares Sink on BOJ Rate Hike

Published

on

Masayoshi Son

Masayoshi Son, the founder of SoftBank Group Corp., saw his fortune decrease by $2.6 billion in just two days as shares of his technology conglomerate plummeted.

The significant drop comes in the wake of an unexpected interest rate hike by the Bank of Japan (BOJ), which has sent shockwaves through the Japanese stock market.

SoftBank Shares Plunge

On Friday, SoftBank shares fell by 8% in Tokyo trading, capping a two-day decline of approximately 14%. This sharp drop in value has erased a substantial portion of the gains Son had accrued earlier in the year.

Despite this setback, Son’s net worth remains approximately $14 billion, still up from the $11.3 billion he started with at the beginning of the year, according to the Bloomberg Billionaires Index.

Impact of BOJ’s Policy Shift

The BOJ’s decision to raise interest rates sooner than anticipated has had a profound effect on Japanese stocks, particularly those in the technology sector. SoftBank, one of the world’s largest tech investors, has been significantly impacted.

The company had enjoyed a 46% increase in its stock price through the end of July, driven by its holdings in companies like chipmaker Arm Holdings Plc.

However, Arm’s shares dropped by 16% on Thursday after the company reaffirmed its annual sales forecast, disappointing investors who had hoped for more optimistic projections.

Economic and Market Repercussions

The broader Japanese market also suffered, experiencing its most significant drop since 2016. Investors reacted to the tighter monetary policy with a selloff, leading to widespread declines across various sectors.

SoftBank’s extensive international operations make it particularly vulnerable to currency fluctuations.

The yen strengthened to a four-month high on Thursday, following the BOJ’s hawkish stance, which added to the pressure on SoftBank’s stock.

Masayoshi Son’s Financial Position

Masayoshi Son, 66, remains the largest shareholder of SoftBank, which is valued at approximately $78 billion.

However, much of his stake is pledged as collateral for loans with various financial institutions. This arrangement heightens the financial risks for Son, especially during periods of market volatility.

SoftBank’s Performance and Future Prospects

SoftBank has been a major player in the technology investment space, with significant stakes in companies that are at the forefront of innovation, such as those involved in artificial intelligence.

The company’s future performance is likely to be closely watched by investors, particularly in light of the recent market turbulence and the BOJ’s policy changes.

Broader Economic Context

The BOJ’s interest rate hike is part of a broader effort to address economic challenges, including inflation and currency stabilization.

The impact of this policy shift on Japanese businesses and the global economy remains to be fully seen.

Analysts and investors are closely monitoring developments, particularly as they relate to major corporations like SoftBank.

The recent decline in SoftBank’s stock price and the resulting loss in Masayoshi Son’s wealth underscore the volatility and uncertainty in today’s financial markets.

Continue Reading

Trending