Stock price of First Holdco gains 9.94% amid Otudeko’s exit

The stock price of First Holdco Plc, on Thursday gained 9.94 per cent, amid investor speculation following a massive off-market transaction involving over N324.47 billion or 10.4 billion shares on the floor of the Nigerian Exchange Limited (NGX).

First Holdings stock price opened for trading on NGX at N32.20 per share, gained 9.94 per cent or N3.20 per share to close at N35.40 per share.

The reported N35.40 per share on NGX is the 52-week high of First Holdco on the NGX and the price movement reflects growing market interest in a significant change in the company’s ownership structure.

In two-day, the stock has gained 20.8 per cent from N29.30 per share when THISDAY reported that a major negotiated deal was executed on the Exchange, at which 10,433,909,058 units of Holding shares were traded off-market at N31.00 per share across 17 transactions.

Findings showed that 17 separate deals took place involving First Securities Ltd as the buyer with CardinalStone Securities Ltd, Meristem Stockbrokers Ltd, Renaissance Capital (Rencap) Securities Ltd, Regency Asset Management Ltd, United Capital Securities Ltd, Stanbic IBTC Stockbrokers Ltd as the seller of First Holdco’s stock.

It was learnt that First Securities Ltd also acted as seller in some deals, indicating a portfolio reshuffling or inter-account transfer.

The transaction, valued at approximately N323.33 billion, represents about 25per cent ownership in the group, which currently has 41.87 billion outstanding shares, making it one of the largest single-day block trades in the market this year.

According to report, mega deal linked to Mr Femi Otedola, who increased his current 15 per cent holdings to about 40 per cent, giving him total control of Nigeria’s oldest bank which has so far punched below its potential.

Oba Otudeko, the erstwhile Chairman of FirstHoldco, was forced to sell off over 20 per cent of shares linked to him as the bank’s management, controlled by Otedola, moved to criminalise and prosecute Otudeko’s past misdeeds in the Federal High, Lagos, even when the issues had been settled commercially with regulatory action. 

With these share transactions, First Bank is expected to withdraw its criminal complaint against Otudeko who at 82 can retire gracefully with over N300 billion in cash.

Another long term shareholder; The Hassan-Odukales voluntarily exited the bank and sold 5 percent of their holdings in a mega transaction as they  seek better shareholder value elsewhere.

These acquisitions by Otedola, markets believe,  is the first step to bringing stability to the troubled bank after years of shareholder in fighting.

Under extant NGX rules, a significant stake is defined as a holding of five per cent or more of a company’s outstanding shares.

Although the negotiated trade window on the NGX allows buyers and sellers with large transactions to pre-arrange terms, including price and transfer of shares, outside the ordinary market’s price discovery mechanism, such trades are still brought to the exchange for formal execution and transfer of ownership.

However, fresh insider information revealed that entities linked to Oba Otudeko and Tunde Hassan-Odukale sold the 10.433 billion FirstHoldco shares to a relatively unknown company — RC Investment Management Limited.

According to sources familiar with the matter, the buyer, RC Investment, is linked to one Samuel Babatunde Sule. The company reportedly acquired approximately 7.787 billion shares from Barbican Capital and RAML, both entities associated with Oba Otudeko.

In addition, RC Investment purchased 2.647 billion shares from entities related to the former Chairman of First Bank of Nigeria, Tunde Hassan-Odukale. These entities include Hassan-Odukale himself, Leadway Holdings, Leadway Pensure PFA, Haskal Holdings, and Leadway/NNPC Staff Pension Investment.