Recapitalization: Access Holdings launches N365 billion rights issue

Access Holdings Plc, the parent company of Access Bank, has officially commenced its anticipated rights issue to recapitalize and meet the Central Bank of Nigeria’s (CBN) requirements for banks.

The initiative follows the company’s earlier announcement over two months ago, stating its intention to raise capital through a rights issue.

In a statement released by the company Sunday, Access Holdings said it has received the necessary approval from the Securities and Exchange Commission (SEC) to execute the rights issue. Unlike a public offering, a rights issue grants existing shareholders the exclusive right to purchase additional shares in the company.

The offering consists of 17.8 billion ordinary shares of N0.50 each, priced at N19.75 per share. The basis for the rights issue is one ordinary share for every two ordinary shares held as of June 7, 2024. The offer will open on July 8, 2024, and close on August 14, 2024.

The rights circular will be distributed to shareholders by the registrars to the offer, Atlas Registrars Limited. Application forms will be available on the websites of Access Holdings, Chapel Hill Denham, Coronation Merchant Bank, and Atlas Registrars.

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The initiative is part of a broader strategy by Access Holdings to raise a combined capital of up to $1.5 billion through equity, quasi-equity, and debt issuances. The substantial capital raise aims to strengthen the bank’s capital base, ensuring it can continue its expansion and seize emerging opportunities within the financial sector.

With this rights issue, Access Holdings will see its issued share capital increase from to 35.5 billion ordinary shares, to N26,658,919,216.50.

Under the CBN’s new stipulation, Access Bank and other first tier lenders require a minimum capital base of N500 billion.