Odukale vs Otedola: The rumble over First Bank

There is a struggle for the control of the soul of Nigeria’s premier banking institution, First Bank Nigeria (FBN) Holdings Plc.

The fight is between the current chairman of the Bank, Mr. Tunde Hassan-Odukale, who is also the chairman of Leadway Assurance Company Limited, and Femi Otedola, billionaire and oil magnate.

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The media has been abuzz this weekend with reports about the move by Otedola to acquire a significant stake in the First Bank group.

First Bank is the country’s second-biggest lender in terms of customer base, a major financier of big projects in Nigeria’s oil and gas, power, and other sectors with a significant impact on the nation’s economy. So there is a lot of interest in it from various groups.

After initially refuting media reports that Otedola had acquired a significant stake in the bank yesterday, FBN Holdings later admitted receiving the information from the oil tycoon.

“We refer to our communication to the market dated October 22, 2021, on the above subject wherein we stated that we would inform the public of any substantial acquisition, upon receipt of notification from the Shareholder,” FBN Holdings said in its statement late on Saturday.

“This morning, October 23, 2021, FBN Holdings Plc received a notification from APT Securities and Funds Limited, that their Client, Mr. Otedola Olufemi Peter, and his nominee, Calvados Global Services Limited have acquired a total of 1,818,551,625 units of shares from the Company’s issued share capital of 35,895,292,791.

“Based on the foregoing, the equity stake of Mr. Otedola Olufemi Peter and his nominee in the Company is now 5.07%,” it said thereby authenticating media reports on Otedola’s moves to become a significant player in the Bank,” the bank said.

That was in fact the second part of an equation that now amounts to a fight or scramble for the trunk of the Elephant. Unknown to many people, First Bank Holdings had on October 18, 2021, also informed the Registrar General of the Corporate Affairs Commission that a group led by Mr. Tunde Hassan-Odukale, its chairman, had acquired a 5% stake in the bank through various vehicles.

The letter to the registrar general, written from Asabia House, FBN Holdings Head Office,  said: “In line with the provisions of Section 119 (1) of the Companies and Allied Matters Act (2020), the Company received a notification on Friday, October 15, 2021, from Leadway Assurance Company Limited, that Mr. Tunde Hassan-Odukale (Chairman, First Bank of Nigeria Limited) and related parties had acquired a total of 1,923512099 units of shares from the Company’s issued share capital of 35,895,292,791.”

This number of shares held by Mr. Hassan-Odukale and his group amounts to 5.36% of the Bank’s issued share capital, according to the statement.

These disclosures make Otedola the second-largest individual shareholder, while Mr. Hassan-Odukale is actually the largest individual shareholder.

The evolving fight for the control of FBN Holdings raises some pertinent questions about the bank group going forward. What does it mean for the minority shareholders?  Will they be protected? What will the fight mean for customer service?

Will it in any way lead to a change in management or could it result in some form of distraction for the management? Will the fight for the soul of FBN Holding lead to a distraction of the management from focusing on its strategy?

It also raises a pertinent question for the banking-sector regulator, the Central Bank of Nigeria, which appointed Mr. Hassan-Odukale, following the ouster of Dr. Otudeko?

Where do other influential shareholders, including Dr. Mike Adenuga, who is also renowned to hold a notable stake in the bank, a former chairman of the bank, and Alhaji (Dr) Umaru Abdul Mutallab, stand?

These are some of the questions that beg for answers as the fight for the soul of the elephant rages.