Fidelity Bank PLC combined N127.1 billion rights and public offer have struck early success as enthusiastic shareholders mobilise to pick their pre-allotted shares and buy more stakes in the Bank.
Shareholders said “they would pick their rights and buy more shares from the public offer in a massive show of support and positioning in the Bank.”
In separate interviews, shareholders said the pricing of the highly discounted rights issue and public offer, the operational growth of the bank over the years, dividend records and capital gains were attractions to buy more stakes in the bank.
“Fidelity Bank is one of the few companies that pay dividends twice a year in the stock market. The bank had delivered an average annual capital gain of more than 100 per cent over the past five years and ranked among the elite stocks with the highest corporate governance rating in the Nigerian stock market,” they said.
Shareholders envisioned that a post-recapitalisation Fidelity Bank would deliver higher returns and continue to be a leading preserver of values for shareholders’ wealth.
Fidelity Bank is offering a rights issue of 3.2 billion ordinary shares of 50 kobo each at N9.25 per share. The bank is also simultaneously offering 10 billion ordinary shares of 50 kobo each to the general investing public at N9.75 per share.
The acceptance and application lists for the rights issue and public offer, which opened on June 20, 2024, are scheduled to close on July 29, 2024. The rights issue has been pre-allotted on the basis of one new ordinary share for every 10 existing ordinary shares held as at the close of business on January 05, 2024.
President, Association for the Advancement of Rights of Nigerian Shareholders (AARNS), Dr Faruk Umar, said the enthusiasms that have greeted the combined rights and public offers suggest a strong possibility of oversubscription for both offers.
Umar said Fidelity Bank has several factors working in its favour including its steep growth, high returns and stable board and management.
“The performance of Fidelity Bank has tremendously increased over the past years. The bank has a very professional board with some of the best independent directorships in the banking industry. The prolific appreciation of the share price is a testimony of the confidence shareholders have in the stock of the company.
“The rights issue’s price is reasonable compared to the dividend paid recently. I am very confident that both the rights and the public offer will be oversubscribed,” Umar said.
National coordinator, Independent Shareholders Association of Nigeria (ISAN), Mr. Moses Igbrude, said Fidelity Bank has consistently shown strong performance and paid dividends over the years while investors have also benefited from price appreciation.
“I believe it is a good investment. As for me, I will take up my rights and equally buy the public offer. I am encouraging investors to take up their rights. The bank is solid and strong with a lot of potential to grow,” Igbrude said.
Chairman, Ibadan Zone Shareholders Association (IBZA), Mr Eric Akinduro, said the combined offer was an opportunity for investors to position for greater returns.
