Titan Trust Bank Limited (TTB) on May 30th, 2022 completed the deal for the acquisition of a total of 88.39 percent equity stake in Nigeria’s second-oldest listed bank, Union Bank of Nigeria (UBN) PLC.
This acquisition makes TTB the controlling investor and holder of the largest equity stake by a single investor in Union Bank, and in any of Nigeria’s publicly listed banks.
This off-market deal is worth N191 billion and stands as the biggest deal in Nigeria’s banking sector in recent years. This deal beats the N72 billion merger between Access Bank and Diamond bank to become the biggest. It is even bigger than the N120 billion deal between Crown Mills and Dangote Flour Mills.
Titan Trust Bank commenced operation in Nigeria in October 2019 making it one of the newest commercial banks in Nigeria. The bank positions itself as a digital bank with an innovation-led model.
At the time of this deal, Titan Trust Bank has only six branches in Nigeria with 12 ATM points and about 110 staff.
Union Bank on the other hand commenced operation in Nigeria in 1917 making it the second oldest bank in Nigeria. The bank has over six million customer base across the country, about 239 branches, 1,000 cash points, and over two thousand staff.
The question becomes how a young bank such as Titan Trust Bank can acquire a major stake in Union Bank.
Titan Trust Bank’s key shareholders are Luxis International DMCC, Magna International DMCC, and Aminu Yao which are linked to Vink Corporation. Vink Corporation is a foreign company and a subsidiary of Tropical General Investment Group (TGI Group). Titan Trust Bank is 85% owned by Vink Corporation. Titan Trust Bank also has an alliance with Citi Bank headquartered in New York which serves as a correspondent bank.
In addition, Titan Trust Bank’s acquisition was possible due to the divestment plans of the core shareholder of Union Bank, Union Global Partners Limited (UGPL), and Atlas Mara, a financial services holding company.
TTB’s Chairman Mr. Tunde Lemo (who is also the chairman of Flutter wave, and a former deputy governor of Nigeria’s Central Bank) remarked that the transaction was a key step for the bank in its strategic growth journey, and will push the institution to the next height in Nigeria banking sector.
According to Mr. Emeka Okonkwo, the Chief Executive Officer of Union Bank, the deal marks a significant milestone in Union Bank’s journey. He appreciated the bank’s investors for their support over the years, and welcomed their new core investors, Titan Trust Bank.
White & Case LLP, Banwo & Ighodalo acted as legal advisers for Union Bank in the deal, while Drew Law Practice, G. Elias &co, and Norton Rose Fullbright LLP acted as legal advice to Titan Trust Bank.
Citigroup Global Markets Limited acted as financial adviser for TTB while Rothschild and Cie was Union Bank’s financial adviser.