QATAR NATIONAL BANK, OTHERS CONVERT SHARES IN ECOBANK

Qatar National Bank (QNB) and some other holders of Ecobank Transnational Incorporatef (ETI) PLC preference shares have decided to convert them to ordinary shares.

According to a formal notice to this effect sent to the Nigerian stock exchange by Richard Uku, Head of Corporate Communications, ETI, in all, out of 1,031,515,911 preference shares outstanding, 79.4% or 819,424,548 are to be converted into ordinary shares.

QNB alone accepting to convert was a big boost since it held 89.4% or 732,277,056 units of the outstanding preference shares.

The preference shares had been held since ETI acquired Oceanic bank in 2011 with the understanding that holders of preference shares issued can  convert into ordinary shares between three and five years after it was issued, if holders so wish.

This option period expired in October this year and QNB led those who decided to exercise it.

The conversion rate shall be one preference share to 0.76923 ordinary shares as mutually agreed during the negotiations for purchase of Oceanic Bank. By implication, the conversion will raise ETI issued shares to 24,730,354,443 units with converting preference shareholding to control 2.55%.

The decision to convert is an expression of investor confidence because it means those who choose to convert no more want preference but fixed treatment while dividends are being apportioned but want to share in what remains after any preferential treatment.

It also means they now will have voting rights and if percentage holding so qualifies, can nominate representatives on the board of directors.

Eventually, they will also have the opportunity to sell their holdings at the three exchanges ETI is quoted in: Nigerian stock exchange; Ghana stock exchange and West African stock exchange, Abidjan.

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