LAGOS, Nigeria: Billionaire businessman and Chairman of First HoldCo Plc, Femi Otedola, has continued his aggressive accumulation of shares in the financial services group, acquiring another 138.04 million shares valued at approximately ₦18.11 billion.
The latest transaction has increased Otedola’s stake in First HoldCo to about 26.1 per cent, further strengthening his position in the parent company of FirstBank Nigeria. The transaction was disclosed in a regulatory filing signed by the company’s Group Company Secretary, Abiola Baruwa.
The purchase comes just days after reports emerged that Otedola is considering increasing his stake in First HoldCo to more than 51 per cent, a level that would give him majority control of the company.
From major shareholder to potential controlling owner
Otedola’s latest acquisition is the latest in a series of major purchases that have dramatically increased his ownership of First HoldCo this year.
Reports indicate that he has invested more than ₦600 billion in the company, with his stake rising from about 5.65 per cent before his appointment as chairman to approximately 26.1 per cent today.
His rapid accumulation of shares has therefore raised a much bigger question in Nigeria’s financial markets:
Is Femi Otedola positioning himself to take control of First HoldCo?
The available evidence increasingly points in that direction.
In an interview reported by Nairametrics, Otedola indicated that he could increase his current holding to around 51 per cent, while reports have quoted him as saying that majority ownership would be important for implementing the reforms and restructuring he believes are necessary to create long-term value.
If he eventually crosses the 51 per cent threshold, Otedola would become the controlling shareholder of First HoldCo, giving him significant control over the strategic direction of the group and its major banking subsidiary, FirstBank.
Why FirstBank?
FirstBank is one of Nigeria’s oldest and most significant financial institutions, with a history spanning more than a century.
For Otedola, the investment appears to be about more than short-term share-price gains.
His increasing ownership gives him greater influence over the direction of the group, while majority ownership would give him substantially greater control over major corporate decisions.
Otedola has also described his investment in First HoldCo as a long-term commitment, pointing to the institution’s history, scale and importance to Nigeria’s financial system.
The 50 per cent strategy
There has also been considerable discussion around reports that Otedola prefers to build substantial, sometimes controlling, positions in companies in which he invests.
However, claims that he has a blanket policy of owning exactly 50 per cent of every company he invests in should be treated cautiously. What is currently supported by recent reporting is his specific ambition to increase his First HoldCo holding to more than 51 per cent.
That distinction is important.
A 51 per cent stake would not simply make Otedola one of First HoldCo’s largest shareholders. It would give him majority control.
How far can he go?
At 26.1 per cent, Otedola is still some distance away from majority ownership.
But his recent buying pattern shows that he has been willing to commit enormous amounts of capital to the strategy.
His latest ₦18.11 billion purchase therefore raises the possibility that the market could see further large acquisitions as he moves towards his reported 51 per cent target.
For now, however, Otedola has not taken majority control of First HoldCo.
What is clear is that his position has grown rapidly, his financial commitment has become enormous, and his reported target of more than 51 per cent has transformed the story from a billionaire making a major investment into a potential corporate-control play.
What happens next?
The biggest question for investors is no longer simply how many First HoldCo shares Otedola will buy next.
It is whether he will ultimately cross the 50 per cent threshold and become the controlling shareholder of the company behind FirstBank.
If that happens, it would represent one of the most significant changes in ownership of a major Nigerian banking group in recent years.
