Barely days to its July 29, 2024 closing date for its combined rights and offer for subscription the board of Fidelity Bank Plc on Tuesday hinted of a possible over-subscription of its ongoing capital raising exercise with the amendment of two key resolutions to be put before shareholders at the July 26 virtual extra-ordinary general meeting in what is an indication of the huge success of the exercise.
According to the amended notice of EGM signed by the Ezinwa Unuigboje, its Company Secretary, the bank now proposed that shareholders should authorise the directors to “accept surplus monies arising from potential over-subscription of the Public Offer in such proportion as” they may determine subject to its Issued Share Capital after obtaining relevant regulatory approvals.
Consequently, the board further proposes that the Issued Share Capital of Fidelity Bank be raised from N22.6bn divided into 45.2bn Ordinary Shares to N26.7bn by the creation of up to 8.2bn additional Ordinary Shares. This, it said, is “to accommodate potential oversubscription of the Public Offer in the proportion of 5bn additional Ordinary Shares under the Public Offer and 3.2bn additional Ordinary Shares under the Rights Issue.
Recall that the combined offer opened on June 20, 2024. As part of the rights issue, existing shareholders had at an earlier EGM of August 11, 2023, approved a capital raising exercise by way of Public Offer of 10bn Ordinary Shares of 50 kobo each at N9.75 per share (valued at N97.5bn) to prospective shareholders and Rights Issue of 3.2bn Ordinary Shares of 50 Kobo each (worth N29.6bn) to existing shareholders at N9.25 per share on the basis of one new share for every 10 shares held at the close of business on January 5, 2024. The Combined Offer opened on June 20, 2024, and will close.
According to the original prospectus, N20.2bn or 70% of the N28.8bn net proceeds of the rights issue will be invested in business and regional expansion, followed by N5.7bn or 20% for IT infrastructure; and the balance N2.9bn or 10% is to be invested in product distribution channels.
Also, the N95bn net proceeds of the public offering is to be invested in the same line items as follows: N66.5bn or 70% for business and regional expansion; N19bn or 20% to be ploughed into IT infrastructure; and the balance N9.5bn or 10% for investment in production distribution channels.
