Historic market deal ends leadership tussle at Nigeria’s oldest bank

…Otudeko, Odukale exit First Holdco in landmark N323.45bn deal

Nigeria’s oldest bank has drawn a line under years of boardroom rivalry after entities tied to Oba Otudeko and Tunde Hassan-Odukale sold a combined 10.4 billion shares in FBN Holdings Plc for N323.45 billion, the largest off-market trade in the history of the Nigerian Exchange.

According to documents obtained by BusinessDay, the buyer in this record-breaking transaction is RC Investments Management Limited, a relatively obscure firm linked to Samuel Babatunde Sule, CEO of Renaissance Capital. Sule’s RC Investment acquired approximately 7.787 billion shares from Barbican Capital and RAML, both entities associated with Oba Otudeko.

In addition, RC Investments purchased 2.647 billion shares from entities connected to former First Bank chairman Tunde Hassan-Odukale. These include Leadway Holdings, Leadway Pensure PFA, Haskal Holdings, and Leadway/NNPC Staff Pension Investment.

Sources familiar with the deal said RC are brokers and that a nominee owns the shares.

“Whoever gave RC- a brokerage firm- the instructions to buy is the principal. Rencap would not buy those securities on credit. They have funded the account for Rencap to pay for them,” one of the sources said.

Another source said it was First Bank, whose chairman is Femi Otedola, buying the shares through RC.

Read also: Outraged First Bank shareholders seek to stop ‘strange’ N350bn private placement

First Bank has not released an official statement on the details of the deal.

The landmark transaction was said to have been brokered by the Central Bank of Nigeria (CBN) as a strategy to finally resolve a long-standing leadership crisis that has hindered the bank’s capital raising efforts for years.

While First Holdco has consistently acknowledged Otudeko’s 8.65 percent stake in the bank, the remaining 9.94 percent of disputed shares has been a source of contention between the businessman and the apex bank.

The deal will see Otudeko walk away with N241.4 billion, effectively marking his exit from First Holdco. Hassan-Odukale and his affiliated entities will cash out N82.1 billion.

Otudeko’s departure signifies the end of a significant chapter in the bank’s history. The octogenarian, who served as group chairman between 1997 and 2021, is set for a quiet exit following nearly 24 years at the helm.

A legacy of boardroom battles

Between 1997 and 2021, Oba Otudeko wielded substantial influence over First Bank, Nigeria’s oldest and most geographically expansive financial institution. Initially serving as chairman of First Bank’s board from 1997 to 2011, he later transitioned to chairing the newly formed holding company, a position he held until his removal in 2021.

That year, the CBN dismissed both Otudeko and First Bank’s board chair, Ibukun Awosika, after a leadership conflict with the then managing director, Adesola Adeduntan.

Shortly after Otudeko’s removal, a fierce battle for control erupted. Femi Otedola entered the fray with a string of off-market purchases that saw him become the group’s largest individual shareholder. At the close of 2020, no shareholder owned more than five percent of the bank. But by October 2021, Otedola had quietly amassed a 5.07 percent stake. That figure rose to 7.57 percent by year-end.

During that window, Otudeko was out of the picture. The spotlight shifted to Otedola and then-chairman Hassan-Odukale, both of whom alternated as the largest shareholders. By December 2021, just eight months after Otudeko’s exit, Otedola and Odukale held 7.57 percent and 5.36 percent, respectively.

The ownership tussle reignited in July 2023 with a seismic market announcement. On July 7, 2023, FBN Holdings disclosed that Barbican Capital, linked to Otudeko, had acquired N87.8 billion worth of shares, pushing its stake to 13.3 percent. It marked the largest single transaction on the NGX since 2012.

However, Otudeko’s web of ownership was anything but straightforward. While Barbican Capital’s 13.3 percent holding was publicised, Otudeko controlled additional shares through a network of shell entities, which complicated efforts to ascertain his true stake. Initially, Barbican’s claim wasn’t officially recognised, and Otedola maintained the title of largest shareholder during the 2023 Annual General Meeting.

That changed in 2024. FBN Holdings formally acknowledged Barbican Capital’s 8.8 percent stake, temporarily naming it the largest shareholder. But the tide turned quickly. By June 2024, Otedola had raised his stake to 9.41 percent and solidified it at 13.16 percent by September.

Meanwhile, Barbican insisted that it controlled a 15.1 percent stake, which it claimed was unfairly excluded. A legal dispute ensued, with the CBN and FBN Holdings arguing in court that a capital verification process was still underway. The apex bank acknowledged that Otudeko’s camp provided documents confirming an 8.67 percent stake but failed to substantiate ownership of the remaining 6.52 percent.

First Bank shares jump 21%

The market has responded positively to the unfolding developments. In just two trading sessions, First Holdco’s share price soared by 21 percent, rising from N29.30 on the morning of July 16 to N35.40 at the close of trading on July 17, its highest level since March 28, 2024.

“The event appears to have generated some excitement,” said Ngozi Odum, a research associate at Cardinalstone Securities. “Investors are most likely viewing it as the ushering in to a new era of First Holdco, where issues surrounding ownership tussles will become a thing of the past.”