Ecobank launches US$2.5 billion share offer
Gilbert Boyefio
26/08/2008
Ecobank Transnational Incorporate, the parent company of the Ecobank group, on Monday simultaneously launched a US$2.5 billion regional share offer in ten African countries, including Ghana. This offer, the largest in Africa, consists of a US$1 billion rights issue and a US$ 1.5 billion offer for subscription.
The rights issue consists of 3,763,759,981 ordinary shares of US$0.025 each at US$0.27 per share, in a ratio of five new shares for every nine existing shares, held payable in full application; while the offer for subscription was for 5,116,499,328 ordinary shares of US$0.25 each at US$0.29 per share payable in full on application.
Speaking at the launch of the ETI Share Offer, the Minister of Finance, Kwadwo Baah Wiredu, described the offer as an ambitious move, and the first of its kind in Africa. The regional offer started in 1984 when the founding fathers gave birth to the one and only African bank with the mandate to serve and develop West Africa.
Mr Kwadwo Wiredu explained that from a modest beginning of 100 million, ETI has grown in leap and bounds and is ready to venture in what is going to be one of Africa's debut mega share offer: "The government is proud to be associated with Ecobank, as it continually seeks to contribute to employment in the country by positioning strategic affiliates in Ghana, such as the Ecobank-Accion, which is dedicated to micro finance, Ecobank Development Corporation, and Ecobank Ghana [a universal bank with a specific focus on retailing banking].
The Minister pointed out that the government is committed to the development of the capital market in the country, citing the recent divestiture of the government's holding in SIC and GOIL as an example.
He noted that as the automation of the Ghana Stock Exchange is currently underway, the government expects greater dynamism and interest from private sector participants and individual investors alike to ensure that Ghana’s fledging market becomes more deepened and efficient.
Mr Baah Wiredu disclosed that the government intends to continually improve the economic environment to enable the banking sector - the largest segment within the financial service sector - to thrive, and thereby improve funding to the private sector substantially.
Furthermore, he claimed that the banking or financial service sectors are the best positioned to reap the expected benefits of the oil within the medium to long term. By way of example, he cited the total assets of the banking sector, which at the end of May 2008, had grown by 37.1% year on year to GH¢8.4 billion, while credit growth to enterprises and households remained robust and broad based. Mr Baah Wiredu further stated that credit to the private sector and institutions went up by GH¢1.7 billion in the same period, depicting a 58% annual growth.
However, The Minister observed that the economy faced challenging developments during the first half of the year, noting, "Global food shortage and rising oil prices have threatened the economic gains that Ghana has chalked over the last few years."
Giving a preview of the ETI share offer, Managing Director of Ecobank Development Corporation, Mike Ashong, said that the offer opens in August 25 and closes on October 3.
He said that any shares not allocated in the rights issue and the offer for subscription may be offered through an international offering in the form of Global Depository Receipts and an application may be made for such GDR’s to be listed on the London Stock Exchange.
However, the international offer will have a different timetable from the rights issue and the offer for subscription and the purchase price may be different too.
Mr Ashong explained that the reason for the offer is to embark on an accelerated plan to expand the Ecobank group network branches and presence countries, recapitalise its banking subsidiaries to meet increased capital requirements, and to upgrade and modernize its technology platform.
Mr Ashong disclosed that the anticipated net proceeds of approximately US$2.38 billion, assuming completion of both the rights issue and offer for subscription, are therefore expected to be used as follows: capitalization of existing affiliate, US$1,400,000; expansion into new markets and acquisitions, US$350,000 each; and technology and process upgrade, US$76,000.
He said the offer is open to individuals and institutions in jurisdictions in which the making offer of this offer is not prohibited by law. He observed that in the event of subscription, the company will not issue additional shares to take up the excess subscription.
In Ghana, the issuing houses are EDC Stockbrokers Limited and SIC Financial Services Limited.
26/08/2008
Ecobank Transnational Incorporate, the parent company of the Ecobank group, on Monday simultaneously launched a US$2.5 billion regional share offer in ten African countries, including Ghana. This offer, the largest in Africa, consists of a US$1 billion rights issue and a US$ 1.5 billion offer for subscription.
The rights issue consists of 3,763,759,981 ordinary shares of US$0.025 each at US$0.27 per share, in a ratio of five new shares for every nine existing shares, held payable in full application; while the offer for subscription was for 5,116,499,328 ordinary shares of US$0.25 each at US$0.29 per share payable in full on application.
Speaking at the launch of the ETI Share Offer, the Minister of Finance, Kwadwo Baah Wiredu, described the offer as an ambitious move, and the first of its kind in Africa. The regional offer started in 1984 when the founding fathers gave birth to the one and only African bank with the mandate to serve and develop West Africa.
Mr Kwadwo Wiredu explained that from a modest beginning of 100 million, ETI has grown in leap and bounds and is ready to venture in what is going to be one of Africa's debut mega share offer: "The government is proud to be associated with Ecobank, as it continually seeks to contribute to employment in the country by positioning strategic affiliates in Ghana, such as the Ecobank-Accion, which is dedicated to micro finance, Ecobank Development Corporation, and Ecobank Ghana [a universal bank with a specific focus on retailing banking].
The Minister pointed out that the government is committed to the development of the capital market in the country, citing the recent divestiture of the government's holding in SIC and GOIL as an example.
He noted that as the automation of the Ghana Stock Exchange is currently underway, the government expects greater dynamism and interest from private sector participants and individual investors alike to ensure that Ghana’s fledging market becomes more deepened and efficient.
Mr Baah Wiredu disclosed that the government intends to continually improve the economic environment to enable the banking sector - the largest segment within the financial service sector - to thrive, and thereby improve funding to the private sector substantially.
Furthermore, he claimed that the banking or financial service sectors are the best positioned to reap the expected benefits of the oil within the medium to long term. By way of example, he cited the total assets of the banking sector, which at the end of May 2008, had grown by 37.1% year on year to GH¢8.4 billion, while credit growth to enterprises and households remained robust and broad based. Mr Baah Wiredu further stated that credit to the private sector and institutions went up by GH¢1.7 billion in the same period, depicting a 58% annual growth.
However, The Minister observed that the economy faced challenging developments during the first half of the year, noting, "Global food shortage and rising oil prices have threatened the economic gains that Ghana has chalked over the last few years."
Giving a preview of the ETI share offer, Managing Director of Ecobank Development Corporation, Mike Ashong, said that the offer opens in August 25 and closes on October 3.
He said that any shares not allocated in the rights issue and the offer for subscription may be offered through an international offering in the form of Global Depository Receipts and an application may be made for such GDR’s to be listed on the London Stock Exchange.
However, the international offer will have a different timetable from the rights issue and the offer for subscription and the purchase price may be different too.
Mr Ashong explained that the reason for the offer is to embark on an accelerated plan to expand the Ecobank group network branches and presence countries, recapitalise its banking subsidiaries to meet increased capital requirements, and to upgrade and modernize its technology platform.
Mr Ashong disclosed that the anticipated net proceeds of approximately US$2.38 billion, assuming completion of both the rights issue and offer for subscription, are therefore expected to be used as follows: capitalization of existing affiliate, US$1,400,000; expansion into new markets and acquisitions, US$350,000 each; and technology and process upgrade, US$76,000.
He said the offer is open to individuals and institutions in jurisdictions in which the making offer of this offer is not prohibited by law. He observed that in the event of subscription, the company will not issue additional shares to take up the excess subscription.
In Ghana, the issuing houses are EDC Stockbrokers Limited and SIC Financial Services Limited.
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