FBN holdings shares drop as Otedola offloads 834m units

The largest single shareholder of FBN Holdings, Femi Otedola, sold about 834 million units of his shareholdings in the last 72 hours.

The transactions, which were reported by FBN Holdings as part of its insider dealing notification to the Nigerian exchange, indicated that Otedola sold about 834,939,764.00 units representing about 30% of his shareholdings in the bank holding company.

• 1,834 Nigerians killed in road crashes in 3 months – NBS
• NIGERIA DAILY: The Tough Battle Before Presidential Candidates

According to filings posted on the Nigerian Exchange’s website, Otedola sold 200,000,000 units at N11.10 on June 6. He sold other shares on same day via entities related to him, including 170,000,000 units at N11.14 via Primrose Global Concept, 53,000,000 units at N11.10 via Impetus Synergy; 120,000,000 units at N11.10 via Wells Properties & Investment Company Limited and 174,939,764 units at N11.14 via Shetland Global. The deal is valued at about N9.28 billion.

FBN Holdings’ share price which has traded within N11-N12 since Otedola became the majority shareholder, fell by 3.11% on Wednesday, dropping to N10.9 at the close of business.

Daily Trust learnt that the transaction, which the billionaire did through one of his stockbrokers, Cardinal Stone Securities, has reduced his shareholding from about 7.57% to about 5.24%.

Although the identities of the buyers are unknown, Daily Trust gathered that the shares were sold to a foreign buyer, thereby, ruling out insinuations that it was bought by another major shareholder.

The Managing Director of APT Securities and Funds Ltd, Mallam Garba Kurfi, said there is nothing unusual about the sales, noting that he might be targeting other opportunities.

“As a businessman, he might see an opportunity somewhere else better than First Bank and decide to take it or he got a better deal,” he said.

The MD of ARM Securities Limited, Mr Rotimi Olubi, who noted that there is limited information about the sales, opined that it might have an impact on investors.

“The possible implication is that the market is information-driven and information like this that affects a major shareholder might impact investors, especially considering that it is not up to a year after his acquisition of the shares, so why is he divesting such volume of shares?” he queried.

He added that the value of the shares is expected to rebound, owing to the first quarter performance of the holdings.

“Don’t forget that his aggressive buying into the securities was what increased the value of the shares then, so the sales is what has led to the fall in price. However, we expect a rebound owing to the performance of the holdings,” he said

Recall that the audited accounts of the bank for the year ended December 2021 confirmed Otedola as the single largest shareholder, owning 2,717,282,140 shares or 7.57% of the bank. The disclosure in the audited accounts clarifies a protracted shareholder squabble over who was the majority owner of the financial institution.