On Wednesday 15th of October, financial journalists anxiously awaited a statement or announcement from the Asset Management Corporation of Nigeria (AMCON) concerning the sale of Enterprise Bank to HBCL Investment Services Limited (HISL).

The day marked the end of the deadline for the HISL, promoted by Heritage Bank Company Limited (HBCL), to pay the 80 percent balance of its N56 billion bid price for the acquisition of Enterprise Bank. On September 11th, AMCON had announced the company as the preferred bidder, ahead of Fidelity Bank, which emerged as the reserved bidder).

Upon the announcement HISL, made the first payment of 20 percent as stipulated in the share purchase agreement (SPA).To seal the acquisition, HISL had 15 days to pay N44.8 billion, and there were apprehensions in some quarters that the company may not be able to come up with such money within the required 15 days.

In apparent response to these concerns, Ifie Sekibo, Managing Director/Chief Executive, Heritage Bank, told journalists, “Efforts are ongoing to ensure that the balance of 80 per cent is also paid in line with the terms, conditions and time frame specified by AMCON”.

Heritage Bank MD, Ifie Sekibo

Thus, at the close of business on Wednesday 15th, the question on the mind of industry observers and financial journalists was, “Has Heritage made the payment? The situation became turbo charged by 6.00pm that day, as mixed signals emerged from AMCON and Heritage Bank.

While bank officials who spoke on condition of anonymity and the bank’s PR agency confirmed to journalists that HISL has made the final payment, AMCON’s spokesman, Kayode Lambo told journalists that AMCON is yet to see the money in its account.

This led to a dilemma for financial journalists on what story to write for the next day. While some decided to wait till AMCON confirm the payment, some, decided to write the story based on information from both parties.Thus, the financial industry went to bed, with uncertainty about the Heritage Bank bid to acquire Enterprise Bank.The uncertainty, drama and suspense over the fate of the bid were however brought to an abrupt end 10.30am Thursday October 16, when AMCON released a terse email titled, “AMCON confirms payment for Enterprise Bank”.

The email stated, “We hereby confirm that HBCL Investment Limited has paid the required balance for the purchase of Enterprise Bank.As per the Share Purchase Agreement, the agreed completion phase now commence, this includes seeking all regulatory approvals”.This effectively ended the rigorous and competitive process for the sale of one of the nationalised banks sold to AMCON by the Nigeria Deposit Insurance Corporation (NDIC) in 2011.

From intervention to nationalisationEnterprise Bank was formed to assume the assets of the defunct Spring Bank, a product of the merger of six banks during the 2006 consolidation exercise.The legacy banks were ACB International Bank Plc, Citizens International Bank Plc, Fountain Trust Bank Plc, Guardian Express Bank Plc, Omega Bank Plc, and Trans International Bank Plc.Spring Bank however struggled due to a series of factors, chiefly corporate governance issues, and infighting among majority shareholders of the legacy banks.

Thus, it was severely affected by the impact of the global financial crises of 2008. As a result it was one of the eight banks taken over by the Lamido Sanusi led CBN in 2009, with the appointment of a new board to stabilise and recapitalise the bank.When it was obvious that the bank, alongside Bank PHB and Afribank, would not be able to meet the September 2011 recapitalisation deadline, the CBN revoked their licenses, and handed them over to NDIC.

The Corporation on its part formed Enterprise Bank, Mainstreet Bank and Keystone Bank to assume the assets of the three banks.They were thereafter sold to AMCON, which appointed its own management and injected N680 billion into the banks, with the promise to sell the banks within three years.

The process of selling the banks started in 2012, with the appointment of Renaissance Capital and CitiBank to advise AMCON on what method to adopt in selling the banks. On their part, the advisers recommended that the banks be sold to local and foreign investors.A wild goose chaseWhile this was going on, Mr. Ifie Sekibo and some investors were busy chasing a banking license, to revive the defunct Societe Generale Bank.Their efforts came to fruition February 2013, when the new Bank, Heritage Bank, commenced operations.

Their immediate preoccupation was how to verify and settle depositors of SGBN, gain public acceptance and confidence, with the hope of pursuing their organic growth plan through branch expansion.But they had to battle the intense competition in the industry, and the unprecedented tight monetary policy regime of the CBN, as well as non favourable policies like the gradual removal and reduction of CoT.

The bank however had the luck of the rapid adoption of electronic banking services in the industry and the increased public acceptability courtesy of the cashless policy.According to industry standards, Heritage bank is still at infancy stage. And infants are not expected to attempt what adults do.

Thus few gave the bank any chance to succeed when information emerged that the Bank was among those bidding to acquire Enterprise Bank.Not with the likes of Diamond Bank, Fidelity Bank Standard Chartered Bank, Sterling Bank Plc, Stanbic IBTC Bank Plc contending for the same prize.

With such formidable competitors, the bid by Heritage Bank was dismissed as a wild goose chase.More so, one of its competitors was so determined to win that it employed regional sentiments and political influence of one its shareholders, to win political support for its bid.

This however did not deter the management of Heritage Bank. “We should not shy away from it.We want to make that move because of the strategic fit, because we have been through restructuring and reorganisation of this, and the government and current management of Enterprise Bank in restructuring and putting that organisation together.We don’t want a misfit or a mismatch in that space. And so, we are not shy to say we are fit for it. Sekibo said in response to pessimism about Heritage’s bid for Enterprise Bank.

The challenge aheadAnd that is the next challenge. To prove to stakeholders that Heritage Bank is not a misfit for Enterprise Bank.Interestingly, even before the industry could adjudge its management of making a success revival of the defunct SGBN, Heritage Bank is assuming the daunting and risky task of integrating a bank with rich history of crisis, tainted with unpleasant regulatory intervention.

There would be the inevitable challenge of staff issues, system integration, as well as convincing the customers of Enterprise Bank that the acquisition would bring better services. Thus the wining the bid and raising the money may be the easiest part of the job for the Sekibo led management.

Notwithstanding these challenges, Sekibo expressed confidence of a smooth and successful integration. “ With this take over process going on smoothly, we are sure a more energised bank with improved capacity to create, preserve and transfer wealth will soon emerge ; our shareholders would be happy and customers would be better off for it”, he said.“We would engage the numerous staff of Enterprise Bank.

As you are aware, they are more than us, they have a lot more branches than we do, so, we would need them as they would us.We would work together as a family to achieve a seamless movement from one organisation to a bigger organisation and nobody in that organisation would lose his or her job.All we have is just 15 experience centres; we are talking of an organisation that has over 170 points of service. So, we have no choice, but to work with them,” he added.

Vanguard-