First Atlantic Bank has officially informed the Bank of Ghana over its planned “Merger” with Energy Commercial Bank.
According sources, the necessary documents have been submitted to the Central Bank for their approval for the two parties to go ahead with the merger.
Apart from the two banks bringing their capital together, First Atlantic Bank is said to be bringing additional funds that they raised from some strategic investors during its recent private placement that they carried earlier this year as well as some private equity firms.
Is the ‘marriage’ between the two banks a merger or a takeover?
Sources say First Atlantic Bank’s “marriage” with Energy Commercial Bank is a merger but could be technically described as a “takeover”.
Ghanatalksbusiness.com is informed that the deal would result in a share swap, this could mean that there might not be an “outright cash” purchase, while, Energy Commercial Bank would have shares in the new entity that would be created.
However, after the takeover or merger, the new entity will still be known as First Atlantic Bank
The “takeover” has come about as a result of the inability of Energy Bank to raise the required amount to help them meet the new BoG ¢400 million capital requirement.
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Energy Bank was hoping to raise the remaining amount through its Initial Public Offering (IPO) to raise some ¢340 million cedis, which was not successful.
“The minimum amount to make the Offer successful was not raised and therefore refunds will be made to all applicants. Applicants are advised to contact receiving agents or receiving banks where they applied for shares in the Offer to receive their refund,” the Bank said in a statement.
The Bank said, “Applicants should ensure that they have proof of their application (e.g. receipt) and proof of identification when they contact the respective receiving agents or receiving banks.”
Refunds will be available at the registered offices or branches of the respective receiving agents and receiving banks from 14 December 2018.
About the two banks
Energy Bank Ghana Limited was incorporated in 2009 as a private limited liability company. Energy Commercial Bank presently operates 12 branches in Ghana- five in Accra, three in Kumasi, and the rest in Tema, Takoradi and Tamale.
Energy Bank’s third quarter financial ending September 2018 puts its stated capital at ¢60 million, while profit for the third quarter was at ¢966,000.
First Atlantic Bank started operations in 2011. According to its third-quarter results.
