It is now been confirmed that there will be a merger of Diamond Bank and Access Bank. Rumours swirled around the banking sector last month, but this was quickly denied.
However, on Monday 17 December, the Board of Diamond Bank PLC released a statement by the company’s Secretary and Legal Adviser, Uzoma Uja announcing plans to merge its operations with Access Bank.
According to Diamond Bank, the decision follows a strategic review leading to a competitive process, as the preferred bidder with respect to a potential merger of the two banks (“the merger”) that will create Nigeria and Africa’s largest retail bank by customers.
“The Board of Diamond Bank believes that the merger is in the best interest of all stakeholders including, employees, customers, depositors and shareholders”.
Diamond Bank with headquarters in Lagos was founded by Dr. Pascal Dozie in 1990 but he relinquished management in 2012 to his son Uzoma Dozie who continued as CEO. As at June 2013, the bank operated 267 branches in Nigeria and is estimated to have a total assets value in excess of US$8bn.
Nairametrics – a financial reporting publisher tweeted, “While a potential Access Bank acquisition/merger with Diamond Bank could still lead to the resignation of Uzoma Dozie, Nairametrics understands the Dozies will keep a significant portion of their shareholding of the bank giving them a seat on the board of the bank.”
Here is the full statement from Diamond Bank
The Board of Diamond Bank Plc (“Diamond Bank”) today announces that following a strategic review leading to a competitive process, the Board has selected Access Bank Plc (“Access Bank”) as the preferred bidder with respect to a potential merger of the two banks (“the merger”) that will create Nigeria and Africa’s largest retail bank by customers.
The Board of Diamond Bank believes that the merger is in the best interest of all stakeholders including, employees, customers, depositors and shareholders and has agreed to recommend the offer to Diamond Bank’s shareholders. Completion of the merger is subject to certain shareholder and regulatory approvals.
The proposed merger would involve Access Bank acquiring the entire issued share capital of Diamond Bank in exchange for a combination of cash and shares in Access Bank via a Scheme of Merger. Based on the agreement reached by the Boards of the two financial institutions, Diamond Bank shareholders will receive a consideration of
N3.13 per share, comprising of N1.00 per share in cash and the allotment of two (2) New Access Bank ordinary shares for every seven (7) Diamond Bank ordinary shares held as at the Implementation Date. The offer represents a premium of 260% to the closing market price of N0.87 per share of Diamond Bank on the Nigerian Stock Exchange (“NSE”) as of December 13, 2018, the date of the final binding offer.
Immediately following completion of the merger, Diamond Bank would be absorbed into Access Bank and it will cease to exist under Nigerian law. The current listing of Diamond Bank’s shares on the NSE and the listing of Diamond Bank’s global depositary receipts on the London Stock Exchange will be cancelled, upon the merger becoming effective.
Diamond Bank expects the transaction to be completed in the first half of 2019.
We will keep the market updated with any new development.
Yours faithfully, For: DIAMOND BANK PLC
Uzoma Uja Company Secretary/Legal Adviser