Wema Bank To Sell Off 75% Stake in GNI

Wema Bank Plc has secured approval from the Nigerian Stock Exchange, NSE, to sell off its 75 per cent majority equity stake in Great Nigeria Insurance, GNI, Plc to Insurance Resourcery and Consultancy Services Limited.
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Under the transaction, a block divestment of 2.87 billion ordinary shares of GNI currently held by Wema Asset Management would be transferred to Insurance Resourcery and Consultancy Services, a relatively unknown firm.
According to a  document obtained at the weekend, authorities at the NSE, where both Wema Bank and GNI are listed, have approved the divestment.

The divestment is valued at N1.44 billion at current market value of GNI, which currently has total paid up capital of 3.827 billion ordinary shares of 50 kobo each with a market capitalisation of N1.91 billion. GNI is trading at its nominal value of 50 kobo per share.

GNI at the weekend indicated that Wema Bank was its core investor. “Besides many well meaning Nigerians ,who invested in Great Nigeria Insurance Plc, our other core investors are Wema Bank Plc and Odua Investment Group of Companies. Our relationships with these great groups have created a synergy for the growth of our business,” GNI stated in its corporate profile.GNI started operations in 1960 and its businesses include general and life insurance. Following the Central Bank of Nigeria (CBN)’s banking regulatory regime that required banks to either divest from non-core banking subsidiaries or form a holding company to hold those subsidiaries, Wema Bank had opted to divest from its non-core banking businesses, including GNI.

The bank had since divested from Wema Insurance Brokers Limited, Wema Registrars Limited, Independent Securities Limited and Whyte Cleon Limited. It also integrated operations of four subsidiaries into its core banking business including Wema Asset Management Limited, Wema Securities and Finance Plc, Wema Homes (Savings and Loans) Limited and Wise Properties Limited.
Wema Bank had 100 per cent equity stakes in the trio of Wema Registrars, Wema Insurance Brokers and Whyte Cleon Limited while it had 94.7 per cent stake in Independent Securities and 75 per cent in GNI.Meanwhile, the new core investor would be required to restructure GNI’s issued share capital to dilute the existing concentrated shareholdings of the core investors and allow more investments from the investing public.

In the latest report on public shareholding status in quoted companies obtained by The Nation, the NSE indicated that GNI and 10 other companies were in violation of the listing requirement, which compels companies quoted on the main board of the NSE to ensure that a minimum of 20 per cent of its issued shares is in the hand of the general investing public.