BY MICHAEL EBOH
Any attempt by the Asset Management Corporation of Nigeria, AMCON, to list the three nationalized banks on the Nigerian Stock Exchange, prior to their eventual sale will not achieve the desired objectives and is likely to fail, says Mr. Johnson Chukwu, Managing Director of Cowry Asset Management Plc.
Chukwu, in an interview on a television programme, said instead of listing the banks on the NSE, AMCON should instead, look for a core investor, who will purchase a significant stake in the banks.
He said AMCON should ensure that the core investor possess the necessary requirement needed to make the banks thrive, such as a good management, staff and the right processes.
He said, "It is not a good alternative to list the banks on the NSE as they are, prior to their sale. There is the need to get core investors to invest in each of the banks.
"If f you don't have a core investor that will actually bring in management into these banks, the banks will not be able to thrive in this kind of environment.
He suggested that AMCON should consider selling about 60 per cent of each of the banks to core investors, while the remaining 40 per cent can be listed and sold to retail investors on the floor of the NSE.
He also advised that AMCON seek for buyers of the banks from foreign banks with the right competencies, and which are interested in investing in the country and in the banks.
He said, "AMCON need to first identify a core investor who controls majority shareholding in each of the banks, and then the other portions maybe about 40 per cent or there about, can go to the general public.
"Any institution without core investor in this country will not succeed. So the best option is for us to first identify the core investors who have managerial competence, who have financial muscle and who have the integrity and pedigree to run these banks.
"Preferably, AMCON should identify and get foreign financial institutions to buy into these banks and become core investors. Listing them should not be the strategic option for the banks."
The Asset Management Company of Nigeria, AMCON, had in July, said it may list the three nationalised banks — Mainstreet Bank Limited, Keystone Bank Limited and Enterprise Bank Limited — on the Nigerian Stock Exchange, NSE, instead of selling directly to other banks.
According to Managing Director/Chief Executive Officer, AMCON, Mr. Mustapha Chike-Obi, this is to determine their true value prior to their sale.
The listing, he said, will also ensure that the sale of the three banks is done in a transparent and fair manner. He said, however, that AMCON will need to find financial advisers before finalising its decision on whether to list directly or sell to competitors.
He said, "AMCON is appointing an adviser that will evaluate and determine the value of the banks, evaluate all the options available to AMCON. We expect our eventual adviser to consider this option of listing among other options."
Chike-Obi had said in April 2012 that all three rescued banks were now profitable.
Vanguard Nigeria