Shareholders approve Union Bank’s plan to float N50b rights issue

Shareholders of Union Bank Nigeria Plc, have approved five resolutions authorising the board of the bank to raise up to N50 billion by way of rights issue.

The shareholders gave their approval at the bank’s extraordinary general meeting held in Lagos on Wednesday.

In a bid to accommodate the new shares, the shareholders’ approved the increase of authorised capital of the bank from N9.5 billion (made up of 19 billion ordinary shares) of 50 kobo each to N17.5 billion (made up of 35 billion ordinary shares) of 50 kobo each by the creation of additional of approximately 16 billion ordinary shares of 50 kobo each ranking equally with the existing shares of the bank.

Consequently, the memorandum and articles of association of the bank will be amended to reflect the increase in the authorised share capital to N17.5 billion.

Addressing shareholders during the meeting, the Chief Executive Officer of the bank, Emeka Emuwa, explained that the capital would enable the bank achieve its long-term growth, while the proceeds would be deployed into revenue generating business opportunities.

“Obtaining shareholder approval for our capital increase is a necessary step bringing us closer to the rights issue.

“Incremental capital will further strengthen Union Bank’s near-term positioning and enable us realize our long-term growth aspirations,”

“We view the right issue approval as a strong sign of shareholder support for Union Bank’s growth strategy and our plans to scale up operations and strengthen our position in readiness for uptake when the macroeconomic direction changes.”

Amending the bank’s memorandum of association and the articles of association in order to authorise an increase in the bank’s share capital required the approval of at least a three-quarter majority of votes present at the EGM, even as 99.6 percent of the votes supported the issue.