Providus Bank is set to become a publicly listed company on the Nigerian Exchange (NGX) following its proposed merger with Unity Bank, subject to the final shareholder structure of the combined entity.
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Path to public listing
According to the scheme of merger obtained by BusinessDay, the enlarged bank will be re-registered as a public company if its total number of shareholders exceeds 50. This step would make a listing on the NGX mandatory.
The document states: “That if the total number of shareholders in the Enlarged Bank post-Merger exceeds 50, the Enlarged Bank be re-registered as a public company limited by shares.”
Providus Bank shareholders approved the resolution at a court-ordered meeting held on 26 September. With Unity Bank’s 79,000 shareholders, the combined number in the merged institution is expected to surpass the 50-shareholder threshold, triggering re-registration and potential listing.
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Share swap and capital structure
Under the merger terms, Unity Bank shareholders may choose between a cash payout of ₦3.18 per share or a share exchange of 18 Providus Bank shares for every 17 Unity Bank shares.
If all shareholders opt for the share consideration, Providus Bank’s issued share capital will increase from 41.8 billion to about 54.2 billion shares, resulting in a paid-up share capital of ₦27.1 billion.
Upon completion, Unity Bank shareholders will hold 22.8 per cent of the enlarged entity, while existing Providus Bank shareholders will retain 77.2 per cent.
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Shifts in major shareholdings
The merger will also alter the ownership structure of Providus Bank. Northwest Petroleum & Gas Limited, currently the largest shareholder with 23.99 per cent, will see its stake reduced to 18.5 per cent but will remain the dominant shareholder. The company, founded by Winifred Akpani, wife of Providus CEO Walter Akpani, has maintained a significant influence in the bank’s affairs.
Vetiva Capital Management’s 8.27 per cent holding will be diluted to 6.38 per cent post-merger. Meanwhile, the Asset Management Corporation of Nigeria (AMCON), which sold a 34.22 per cent stake in Unity Bank in September to an undisclosed investor, will see that stake translate to about 7.8 per cent in the merged institution—potentially making the buyer the second-largest shareholder, if they opt for shares instead of cash.
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A new mid-tier powerhouse
Once completed, the merger will create Nigeria’s ninth-largest bank by assets, with a combined asset base of ₦4.49 trillion as of the 2024 financial year. The new entity will operate 230 branches nationwide, combining Providus Bank’s 19 branches with Unity Bank’s 211.
Providus shareholders have also approved the adoption of the name Providus-Unity Bank for the merged entity. The new institution is expected to leverage the strengths of both banks to expand its national reach and strengthen its position in Nigeria’s competitive banking sector.
