The African Export Import Bank has announced the disbursement of a $300m Intra-African Investment Financing Facility to Titan Trust Bank (TTB) to support its acquisition of a majority stake in Union Bank Plc, Nigeria.
The deal will enhance the competitive dynamics of the Nigerian banking sector, while maintaining confidence in the country’s financial services and broader financial stability.
The recently disbursed financing, according to Afreximbank will complement the funds required for the proposed acquisition.
Afreximbank’s financial support enables TTB to secure the acquisition of a well-capitalised bank with an extensive network, enabling the entity to better serve vital economic activities of the public sector, companies, and small and medium-sized enterprises.
A member of the Tropical General Investment (TGI) Group – a pan-African group with diversified investments across seven African countries in various industries and a large network of origination, distribution, and supply chain hubs, the bank in a statement said TTB will leverage the acquisition of Union to enhance its capacity to capitalize on the unparalleled opportunities presented by the African Continental Free Trade Area (AfCFTA).
Afreximbank said it will continue to support the new merged entity in trade finance to promote intra- and extra-African trade through its broad range of programmes and initiatives, including the Afreximbank Trade Facilitation Programmes (AfTRAF) and AfPAY, the Bank’s international payment services.
It noted that the development impact of the acquisition is immense as TTB will leverage the merged entity to provide financing of about $3bn over the medium term of which over $600m will directly support intra-regional trade finance.
Commenting on the transaction, Professor Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank, emphasised the Bank’s commitment to strengthening the position of indigenous financial institutions.
He said this would help to increase Africa’s control over its own financial markets and creating greater economic resilience for the continent.
He said, “As international capital retreats from Africa, we must redouble our efforts to build an effective and resilient financial services sector on the continent, committed to intra-African trade and investments and the development of regional value chains.
“Afreximbank is confident that the transaction will engender confidence in the Nigerian financial system, attract additional capital investments and support the financial inclusion of small-scale enterprises, women-led businesses, youth enterprises and start-ups who are critical to the successful implementation of the AfCFTA.”
Mr Mudassir Amray, Managing Director and CEO of Titan Trust Bank, commended Afreximbank for the exceptional support throughout the transaction.
He further commended the Afreximbank team for its professionalism and dedication which led to the successful completion of this landmark transaction in a record time.
He added that “Afreximbank is one of a handful of organisations that remain bullish in Africa in this period of global uncertainty. The new merged entity will continue to work with Afreximbank to support businesses to promote intra- African trade.”