The share price of Diamond Bank jumped by 9.47% on Monday as investors reacted positively to its planned acquisition by rival- Access Bank Plc, after weeks of speculations and spirited denials by both parties.
In a notice to the Nigerian Stock Exchange (NSE) on Monday morning, Access Bank said it will acquire the entire issued share capital of Diamond bank in exchange for a combination of cash and shares in Access Bank via a Scheme of Merger that will see the latter’s shareholders receiving N3.13 per share, representing 260% of its closing price on Friday, December 15, 2018.
The share price of Diamond Bank opened at 95 kobo, after hitting a high of N1.04, as investors exchange 70.984m units worth N72.643m in 129 deals.
Access Bank was however not left out, as its share price soared by 9.4%, with traders crossing 13.616m shares valued at N108.55m in 254 deals, closing at N8.15 each, the day’s peak, after gaining 70 kobo from its N7.45 opening price.
In the notifications signed by their Company Secretaries, both bank said they have sign a Memorandum of Agreement (MoA) regarding a potential merger.
In the letter by Sunday Ekwocha of Access Bank, the potential merger followed “its selection as preferred bidder after a competitive process undertaken by the board of Diamond Bank… will create Nigeria’s and Africa’s largest retail bank by customers.”
In Monday’s edition of the daily market report, analysts at Arthur Stevens Asset Management Limited, noted that the rise in share price of both banks came on a day the benchmark All-Share Index lost 0.21%.