Access Bank to take over Diamond Bank in $200 million deal
The two Nigerian banks’ merger would form the country’s largest financial institution, but it is somewhat overshadowed by Diamond’s troubled legacy loans to the oil and energy sectors.
Access Bank and Diamond Bank announced on 17 December their intention to merge, for a total consideration of N72.5 billion ($200 million) – confirming a rumour that had been circulating for months but which Diamond had rejected just weeks before.
On November 12, as word of a possible merger was spreading, Diamond Bank reacted in a statement: “We wish to state categorically that the bank is not in discussions with any financial institution at the moment on any form of merger or acquisition.”
How the two banks could have begun discussions – and reached an agreement – in less than a month is hard to fathom. Asked about this, Chiamaka Ezenwa, head of investment banking for West Africa at Exotix, which advised Diamond on the deal, said she could not share the exact timeframe for negotiations, but that “it was a pretty quick transaction”.
The merger, if approved by both banks’ shareholders and by the Nigerian regulator, would create the biggest Nigerian bank by assets, with N6.1