Otudeko Vs. Otedola: First Bank Shareholders Lose N80.76bn, Shares Crumble

It’s no secret that First Bank’s shares have been on a continuous decline, causing significant losses for its shareholders ever since the battle for control of the once-troubled bank began.

Enigeria News recently published a report detailing the tumultuous history of conflicts between billionaires vying for control of the bank. This struggle dates back to 2019 when a management upheaval resulted in the removal of Ibukun Awosika, who was allegedly acting as a proxy for Oba Otudeko. Many believe this operation was orchestrated by the now-disgraced and suspended former governor of the Central Bank of Nigeria, Godwin Emefiele. The report also sheds light on other critical issues that nearly pushed First Bank to the brink, despite its designation as a Systemically Important Bank (SIB).

In a controversial move, Otudeko, in June 2023, made a comeback by acquiring the largest share in First Bank through a cross-deal worth N87.8 billion. This acquisition catapulted him to the position of the bank’s largest individual shareholder, a development that has become a major source of concern for fellow billionaire Femi Otedola.

According to a report by Arise News, the shares purchased by Otudeko, priced at N19 per unit, represent the largest volume of First Bank shares traded in a single day since 2012 when the stock exchange began publishing such data.

The move was considered to be too good to be true, as shareholders were thrown to discomfort over the validity of the trades as they strongly held the view that no single shareholder hitherto officially owned as many shares, and just like World War II, the battle between Otedola and Otudeko ensued ever since.

Although in a recent Annual General Meeting which is still being contested in court, Femi Otedola was appointed a director by some shareholders of the bank; his ragging battle with Otudeko continues to rub off negatively on innocent shareholders of First Bank who daily decry rising losses after several billion went down the drain following the recent collapse of FBN shares in the stock market.

According to ENigeria Newspaper, the stock market performance of FBN Holdings has not been encouraging lately. This is as the company’s share fell to N19.80 kobo, from N21.5 kobo per share.
It was also learned that the total market valuation of FBN Holdings fell to N710.72 billion from N771.74 billion earlier reported a few months back.

Consequently, in the past week, a set of new data obtained by ENigeria Newspaper again suggests that the impact of the ragging battle between Otedola and Otudeko continues to wreak havoc as First Bank Shares plunged further with shareholders now losing another whopping sum of over N80.76bn.

This is as Shares of First Bank dropped from N18.80 on August 18 to N16.55 on August 25, causing shareholders to lose N2.25 for every single share held, data seen and analyzed by ENigeria Newspaper in-house analysts reveal.

For instance, on Monday, August 21, FBNH shares began trading at N18.80 with a market capitalization of N674.83bn but it plunged to N16.55 per share, triggering a fall in market capitalization to N594.1bn.
The drop led to a loss of N80.76bn, making FBNH shareholders the 6th biggest losers in the reviewed period based on a percentage drop in share prices.

It is important to note that the bank has suffered its first blow since Otedola was elected on August 15 at the company’s AGM despite an interim injunction blocking the FBNH from holding its AGM.  Otudeko has the largest majority shares held by an individual in FBNH with 13.3 percent of the company’s issued share capital of 35,895,292,791.

Otedola occupies the second place with 7.57 percent of the company’s issued share capital. Meanwhile, in the first half of 2023, FBNH declared N 187.2bn profit after tax and N383.28bn interest income.