Access Holdings Plans $1.5bn Capital Raising Programme

Access Holdings Plc has unveiled plans to establish a capital raising programme of up to $1.5 billion.

The programme aims to raise $1.5 billion through a share sale or bond offering. The company also plans to ask existing shareholders to raise N365 billion through a rights issue.

Access Holdings in a release said “the Programme aims to enhance the Group’s financial strength through the issuance of various financial instruments such as ordinary shares, preference shares, Alternative Tier 1 capital, convertible and/or non-convertible debt, bonds, or other capital and/or funding instruments.

“The Programme may be executed through a variety of methods including public offerings, private placements, rights issues, book building processes, or a combination thereof. The specifics regarding the tranches, series, proportions, dates, pricing, tenor, and other terms and conditions that may be associated, will be determined by the Board of Directors, contingent upon securing the necessary regulatory approvals,” it pointed out.

The Holdings said, drawing from the programme, the Group expects to raise up to N365 billion specifically via a rights issue of ordinary shares, saying that the proceeds of the proposed rights issue would be used to support ongoing working capital needs including organic growth funding for its banking and other non-banking subsidiaries.

It added that the plans for the programme were disclosed in the Group’s Notice of the second Annual General Meeting holding on April 19, 2024 which was published on the Nigerian Exchange portal on March 27, 2024.

The Central Bank of Nigeria (CBN) on March 28, 2024 unveiled new minimum capital requirements for banks, pegging the minimum capital base for commercial banks with international authorisation at N500 billion. The minimum capital base for commercial banks with national authorisation is N200 billion, while the new requirement for those with regional authorization is N50 billion.

Also, the new minimum capital for merchant banks would be N50 billion, while the new requirements for non-interest banks with national and regional authorisations are N20 billion and N10 billion, respectively.

Access Holdings is a multinational financial services group that offers commercial banking, lending, payment, insurance, and asset management services.