Zenith Bank Lists $850m GDR on London Stock Exchange

 Zenith Bank Headquaters

Goddy Egene and Obinna Chima

The London Stock Exchange (LSE)  Thursday admitted $850 million  of  Zenith Bank Plc’s ordinary shares as Global Depository Receipts (GDRs) on the international bourse.

A GDR is a negotiable certificate held in the bank of one country representing a specific number of shares of a stock traded on an Exchange of another country.
The bank listed 125,000,000 units of the receipts at $6.80 per share. One GDR represents 50 ordinary shares, the bank said, adding that JP Morgan is the depository bank, while Citi is the custodian.

Head of Primary Markets, Africa at LSE, Mr.  Ibukun Adebayo, said  that the GDR listing by the commercial bank would give it access to a wide range of major institutional investors and significantly raise its international profile.

Adebayo added: “Zenith Bank’s listing highlights London’s leading role in supporting Nigeria’s burgeoning financial sector. Three major Nigerian banks have listed in London demonstrating United Kingdom’s and international investors’ appetite for exposure to this fast growing and increasingly diverse economy.”

Zenith Bank’s GDRs would trade on the LSE’s International Order Book, the world’s largest and most liquid GDR market.

Group Managing Director/Chief Executive Officer, Zenith Bank, Mr. Godwin Emefiele said the listing would allow foreign investors to buy the bank’s shares on the LSE and improve liquidity rather than to raise capital immediately.

"The GDR will allow us to raise money cheaply in the future," Emefiele said, adding that Zenith Bank was well capitalised with a capital ratio of 30 percent.
Emefiele said the bank's operations were focused on Nigeria and he expected plenty of financing opportunities to come from developments in the infrastructure and power sectors.

Zenith Bank is the third Nigerian Bank to list GDRs in London following Guaranty Trust Bank Plc and Diamond Bank Plc.

Zenith Bank’s listing meant that the two largest Nigerian banks by market capitalisation are now listed on the LSE. The bank joins a community of 58 emerging market banks listed in London, valued collectively at just under $75 billion.

The listing also gives Zenith access to the deepest international pool of capital in the world, currently holding more than $1.8 trillion in international equity assets. It joins five other companies on the LSE’s markets that have major operations in Nigeria.

Zenith Bank’s share price closed at N21.2 per share yesterday.
The LSE had said it expected an increase in new listings from African companies this year as businesses in the country seek to attract foreign investors