Unity Bank Shareholders Set to Sanction N3.18 Dividend Distribution at Upcoming Court Assembly
Discussions regarding the merger of Unity Bank and Providus Bank Limited have been ongoing since 2024, with the Central Bank of Nigeria (CBN) providing a capital injection to facilitate the process. The bailout loan, worth N700 billion, was approved by the CBN on August 7, 2024.
The proposed merger will see all of Unity Bank's assets, liabilities, properties, intellectual rights, and ongoing legal proceedings transferred to Providus Bank. The remaining N392.3 billion of the bailout loan will be invested in a 20-year Federal Government of Nigeria (FGN) bond, qualifying as tier-2 capital for the merged bank.
A significant portion of the bailout loan is intended to settle Unity Bank's existing obligations, including N303.7 billion owed to First Bank of Nigeria. Additionally, N51.7 billion owed to the CBN under the Anchor Borrower Scheme and N135 billion due to NIRSAL (Nigeria Incentive-Based Risk Sharing System for Agricultural Lending) will also be covered by the loan.
The Federal High Court in Lagos has ordered a shareholder meeting for September 26, 2025. At this meeting, Unity Bank shareholders will have the opportunity to formally consider and approve the arrangements outlined by the court as part of the merger scheme. Shareholders will review and vote on the proposed payouts, the transfer of assets and liabilities, and other key elements of the merger scheme.
Shareholders will receive either N3.18 per share or 18 Providus Bank shares for every 17 Unity Bank shares they currently hold. Voting will be conducted by poll, allowing shareholders to vote in person or authorize a representative to vote on their behalf.
The scheme proposes canceling Unity Bank's share capital, effectively dissolving the bank without winding it up, with ProvidusBank's certificate of incorporation covering the enlarged entity. The order empowers Unity Bank's directors to make any necessary adjustments to the scheme as required by the Securities and Exchange Commission (SEC), the Central Bank of Nigeria (CBN), or the court.
Shareholders wishing to submit their votes or instructions ahead of the meeting must do so through the company secretary by September 23, 2025. The results of the shareholder meeting will be submitted to the court by the Chairman, Mr. Hafiz Mohammed Bashir, the Managing Director, Mr. Ebenezer A. Kolawole, or any other director appointed by the shareholders.
If necessary, Unity Bank's solicitors may seek the court's approval to sanction the scheme. The upcoming meeting is an important step in the merger process, and shareholders are encouraged to carefully consider the proposed arrangements and cast their votes accordingly.
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