- As CBN, AMCON, Reps back acquisition
The Central Bank of Nigeria (CBN) and the Asset Management Company of Nigeria (AMCON) have formally announced the completion of a Share Purchase Agreement (SPA) for the acquisition of 100% of the equity in Polaris Bank by Strategic Capital Investment Limited (‘SCIL’).
A statement issued by the Director, Corporate Communications Department at the CBN, Osita Nwanisobi, on behalf of the apex bank and AMCON disclosed that SCIL had paid an upfront consideration of N50 billion to acquire 100% of the equity of Polaris Bank.
It had also accepted the terms of the agreement, which include the full repayment of the sum of N1.305 trillion, being the consideration bonds injected.
Recall that Polaris has been operating as a bridge bank since 2018 when the CBN intervened to revoke the licence of the former Skye Bank Plc and established Polaris Bank to assume its assets and certain liabilities.
As part of the CBN intervention, consideration bonds with a face value of N898 billion (future value of N1.305 trillion) were injected into the bridge bank through AMCON, to be repaid over a 25-year period.
This is even as the House of Representatives on Wednesday okayed the sale of Polaris Bank, noting that the acquisition followed laid-down procedure and the relevant presidential approval.
According to the statement, “The CBN thus received an immediate return for the value it has created in Polaris Bank during the stabilisation period, as well as ensuring that all funds originally provided to support the intervention are recovered.”
The sale was coordinated by a Divestment Committee comprising representatives of the CBN and AMCON, and advised by legal and financial consultants.
The committee conducted a sale process by ‘private treaty’, as provided in Section 34(5) of the AMCON Act to avoid negative speculation, retain value and preserve financial system stability.
The statement added that, “In the process, parties who had formally expressed an interest in acquiring Polaris Bank, subsequent to the CBN intervention in 2018, were invited to submit financial and technical proposals.
“Invitations to submit proposals were sent to 25 pre-qualified interested parties, out of which three (3) parties eventually submitted final purchase proposals following technical evaluation.
“All submissions were subject to a rigorous transaction process from which SCIL emerged as the preferred bidder, having presented the most comprehensive technical/financial purchase proposal as well as the highest rated growth plans for Polaris Bank.”
The CBN Governor, Godwin Emefiele, said the sale of the bank “marks the completion of a landmark intervention in a strategic institution in the Nigerian banking sector by the CBN and AMCON.”
Speaking on the acquisition on Wednesday, the chairman of the ad hoc committee investigating the sale of Polaris Bank, Hon. Henry Nwawuba, said the lawmakers, during the scrutiny of various documents and the extant regulatory process on the sale of the bank, discovered that there was evidence of substantial compliance with the process.
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