Financial Energy Review
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 per cent of the equity in Polaris Bank by Strategic Capital Investment Limited (‘SCIL’).
This is coming 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.
A statement signed by Osita Nwanisobi, Director, Corporate Communications and posted on CBN website on Thursday, said the sale was concluded after a Share Purchase Agreement (SPA) for the acquisition of 100 per of the equity in the bank by SPA.
It said SCIL had paid an upfront consideration of N50 billion to acquire 100 per cent of the equity of Polaris Bank.
The statement further said it had also accepted the terms of the agreement, which included the full repayment of the sum of N1.305 trillion, being the consideration bonds injected.
It said, “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 (the ‘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 speculations, retain value and preserve financial system stability.”
According to the statement, 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,” it said.
Commenting on the transaction Mr Godwin I. Emefiele, Governor of CBN said: “This sale marks the completion of a landmark intervention in a strategic institution in the Nigerian banking sector by the CBN and AMCON.
“We commend the outgoing board and management for their vital role since the bridge bank was established; in stabilising the bank’s operations, its balance sheet and implementing strong governance structures to address the issues that led to the intervention.
“This process has provided the CBN with an unprecedented opportunity to recover its intervention funds in full and promote financial stability and inclusive growth.
“We wish SCIL well as they implement growth plans to build the bank from the strong foundations that have been established.”
