Afreximbank has disbursed a $40-million investment facility to Fidelity Bank Nigeria Plc to support its acquisition and recapitalization of Union Bank UK.
This move, Elanza News gathered, is part of Fidelity Bank’s international expansion programme.
The facility was provided in two tranches of $20 million each.
The first tranche allowed Fidelity Bank to partially finance the acquisition of a 100% equity stake in Union Bank UK, while the second tranche was used to recapitalize the acquired bank with additional equity.
Through this acquisition, Fidelity Bank aims to establish a pan-African financial institution that can provide correspondent banking and offshore banking services to African banks and meet the banking needs of Africans in the diaspora.
Kanayo Awani, Executive Vice President of Afreximbank, stated that this facility supports African control and ownership of capital, as well as intra-African trade and investments. She emphasized the importance of the transaction in reinforcing African ownership and control in the global financial landscape.
Mrs. Awani also highlighted Afreximbank’s Bank Acquisition Strategy, which empowers African entities to acquire financial assets divested by foreign entities in Africa and the diaspora. This strategy aligns with the bank’s Diaspora Strategy, which aims to promote and finance the integration of the African Diaspora with the rest of the continent.
Furthermore, Fidelity Bank’s CEO, Dr (Mrs) Nneka Onyeali-Ikpe, expressed gratitude to Afreximbank for their support in expanding internationally. She emphasized the strong partnership between the two institutions that has led to this successful outcome.
Elanza News reports that the acquisition of Union Bank UK is expected to contribute to Africa’s economic growth by increasing trade finance and trade flows between Nigeria and the UK.
It will also support the integration of the African Diaspora into regional and continental supply chains and enhance the export competitiveness of small and medium-sized enterprises across the continent.
