“I am an existing shareholder of Guaranty Trust Holding Company (GTCO) Plc and I am also going to take part in the Public Offer because of the immense appreciation I will reap from doing so. I think it makes sense for me and any astute investors to invest in this Public Offer.” That was Adebayo Adeleke, a shareholder rights activist, and former General Secretary of the Independent Shareholders Association of Nigeria (ISAN) while speaking on the opportunities of the ongoing Public Offer by GTCO.
Like Adeleke, the investing public is excited at the opportunity of buying into one of Nigeria’s leading banking groups and one of the high dividend-yielding entities on the floor of the Nigerian Exchange (NGX).
Guaranty Trust Holding Company (GTCO), the parent company of GTBank is one of Nigeria’s biggest bank by assets and it is currently offering a public offer to raise N400 billion.
Following the clearance of the Offer Prospectus and registration of the Offer Shares by the Securities and Exchange Commission, Nigeria (SEC Nigeria), Guaranty Trust Holding Company (GTCO) Plc offered for subscription 9,000,000,000 Ordinary Shares of 50 kobo each at N44.50 per Ordinary Share and it was opened on Monday, July 15, 2024, and will close on Monday, August 12, 2024.
Regarding its target investors, the Group Chief Executive Officer, GTCO, Segun Agbaje said, “The proposed offering was structured as an institution offering targeted at eligible investors and for retail offerings within Nigeria. For the international market, institutional investors would be targeted via private placements.”
On the reorganization of the GTCO as a holding structure, he said: “We believe that the Holding Company structure allowed us to take advantage of new business opportunities in the emerging competitive landscape and strengthen our earnings base. We are very excited to get started on the next phase of our incredible journey to driving Africa’s growth by making end-to-end financial services easily accessible to every African and African Business by leveraging Technology and Strategic Partnerships.”
Buttressing his position, Adeleke said the performance of the Group over the years as a dividend-paying entity is enough to encourage any serious investors to buy into the public offer and become a part-owner.
He said, “As a shareholder, I benefitted as shareholders received a total dividend of N94.180 billion for the financial year ending December 2023, representing a reward of N3.20 for each share held.
During the 2023 financial year, directors declared and paid an interim dividend of 50 Kobo per ordinary share on the share capital of 29,431,179,224 ordinary shares of 50 Kobo each, for the half-year period ended June 30, 2023.
“Looking at its record of always paying dividends and also coupled with the fact that it is among the highest dividend-paying financial institutions in the country, I am confident that the public offer will be oversubscribed”.
In separate interviews, shareholders across Nigeria’s leading shareholders’ associations, despite the fact that the share price in the offer is N44.50, the pricing of the public offer is a result of the operational growth of the bank over the years, dividend records and capital gains.
GTCO is one of the few companies that pay dividends twice a year in the stock market. The bank had delivered an average annual capital gain of more than 100 per cent over the past five years and ranked among the elite stocks with the highest corporate governance rating in the Nigerian stock market.
Shareholders said they envisioned that a post-recapitalisation GTCO would deliver higher returns and continue to be a leading preserver of values for shareholders’ wealth.
Shareholders, under the auspices of the Independent Shareholders Association of Nigeria (ISAN), Pragmatic Shareholders Association of Nigeria and Progressive Shareholders Association of Nigeria among others, said they are mobilising support for the bank.
The general shareholders’ endorsements represent a major boost for GTCO, which has the most diversified retail shareholders’ base among Nigerian banks.
Significantly, GTCO closed trading on Thursday, August 1, 2024, at N44.50 per share after it went up by 50 kobo, recording an appreciation of 1.14 per cent after a total of 14.87 million shares were traded.
The shareholders’ comments came on the heels of similar positive comments by investment experts and capital market stakeholders.
The Chief Operating Officer of Investdata Consulting Ltd, Mr. Ambrose Omorodion, said the performance of GTCO in the past and also currently will speak for it and he is confident that the public offer will end well for the shareholders.
He said, “You know I am not used to unnecessary praise singing. I will tell you that GTCO is a good buy anytime and buying into it at a time like this when the banking sector is recapitalizing is a good way to invest. GTCO has done well and it is a safe place to invest”.
President of the Association for the Advancement of Rights of Nigerian Shareholders (AARNS), Dr Faruk Umar, said the enthusiasm that has greeted the combined rights and public offers suggests a strong possibility of oversubscription for both offers.
Umar, a highly experienced retail investor who sits on boards of many companies, said GTCO has several factors working in its favour including its steep growth, high returns and stable board and management.
“The performance of GTCO has tremendously increased over the past years. The bank has a very professional board with some of the best independent directorships in the banking industry. The prolific appreciation of the share price is a testimony of the confidence shareholders have in the stock of the company.
“The price is reasonable compared to the dividend paid recently. I am very confident that the public offer will be oversubscribed,” Umar said.
National Coordinator, Independent Shareholders Association of Nigeria (ISAN), Mr Moses Igbrude, said GTCO has consistently shown strong performance and paid dividends over the years while investors have also benefited from price appreciation.
“I believe it is a good investment. As for me, I will buy the public offer. I am encouraging investors to take up their rights. The bank is solid with a lot of potential to grow,” Igbrude said.
National Coordinator, Progressive Shareholders Association of Nigeria, Mr Boniface Okezie, said investment in GTCO has proven to be all positive for investors, with good immediate returns and long-term capital appreciation.
According to him, a good investment serves the dual purpose of helping investors with a good stream of income and preserving long-term value.
“I will buy more of GTCO’s shares in this ongoing public offer because of the bank’s performance over the years. It has delivered excellent returns to investors. We’ve not regretted putting our hard-earned money in the bank. That is the reason why I’m going to reinvest more into the bank for further income into my pocket because we are seeing higher dividends from the bank year in and year out. That is what average investors look out for before making their decisions to invest in any company, first and foremost,” Okezie said.
Last–line
GTCO is the most capitalised Banking stock on the Nigerian Stock Exchange and has consistently outperformed its peers in terms of key profitability indicators and other financial metrics.
Widely regarded as a first-rate financial institution, GTCO’s leadership in the Nigerian financial services industry and continuing efforts at empowering people and communities across Africa have earned it many prestigious awards over the years.
The Prospectus incorporating the Application Form is available in physical format at all GTBank Nigeria branches nationwide and in electronic format from www.gtcoplc.com. The Prospectus and Application Forms can also be obtained in physical and electronic formats at the offices and websites of the Issuing Houses to the Offer.
They are, Stanbic IBTC Capital Limited as the Lead Issuing House, ABSA Capital Markets Nigeria Limited, FCMB Capital Markets Limited, and Vetiva Advisory Services Limited.
The Prospectus and Application Forms are also available from the Stockbrokers to the Offer and other receiving agents
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