Billionaire investor Femi Otedola has increased his stake in First Holdco Plc, the parent company of First Bank of Nigeria Limited, to 26.1% after acquiring an additional 1.1 billion shares valued at N18.1 billion. The transaction, executed through his investment vehicle, Calvados Global Services Limited, was disclosed in a filing with the Nigerian Exchange (NGX) on Thursday.
Details of the Transaction
The shares were purchased at an average price of N16.45 per share, according to the filing. This latest acquisition brings Otedola's total holding in First Holdco to 2.2 billion shares, up from his previous stake of 1.1 billion shares, which represented approximately 13.1% of the company.
Otedola, who initially became a significant shareholder in First Holdco in 2023, has been progressively increasing his stake over the past year. His investment vehicle, Calvados Global Services, has been the primary channel for these acquisitions.
Impact on Shareholding Structure
With this move, Otedola solidifies his position as the largest single shareholder in First Holdco, surpassing other major investors such as Tunde Ayeni and Oba Otudeko. The increased stake gives him greater influence over the strategic direction of the financial services group, which also owns FBNQuest Merchant Bank and FBN Insurance.
Market analysts view the development as a positive signal for the company, as Otedola's involvement is expected to bring enhanced corporate governance and strategic focus. "His continued investment underscores confidence in the long-term prospects of First Holdco," said a Lagos-based stockbroker who preferred to remain anonymous.
Regulatory Compliance
The acquisition is subject to regulatory approvals, including clearance from the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC). Under NGX rules, any acquisition exceeding 10% of a company's shares must be disclosed, and Otedola's filing complies with these requirements.
First Holdco's share price has been on an upward trend, closing at N16.50 on Thursday, up 1.2% from the previous day. The company's market capitalization now stands at approximately N1.1 trillion.
Otedola's Investment Strategy
Otedola, who also has significant interests in the energy sector through Geregu Power Plc, has been diversifying his portfolio into banking and financial services. His investment in First Holdco is seen as a strategic bet on Nigeria's economic recovery and the banking sector's resilience.
In a statement, Otedola said, "I am committed to supporting First Holdco's growth and contributing to the development of Nigeria's financial sector. This investment reflects my confidence in the company's management and the opportunities ahead."
Market Reaction
Investors reacted positively to the news, with trading volume in First Holdco shares surging by 45% on Thursday. The stock has gained 18% since Otedola's initial purchase in 2023, outperforming the NGX All-Share Index.
Analysts expect that Otedola's increased stake could lead to further institutional interest in the company, potentially driving up its share price in the medium term. However, some caution that regulatory hurdles and economic uncertainties could temper gains.
