The Humbling of a Bank Chairman: Why Tony Elumelu Bought over Otedola’s Stake in Transcorp

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The Humbling of a Bank Chairman: Why Tony Elumelu Bought over Otedola’s Stake in Transcorp

April 28
17:59 2023

Like a sewer rat fleeing the onslaught of an unrelenting charwoman,  Mr Tony Elumelu, the handsome Chairman of UBA, is running hither, thither as you read.

In what is turning out to be the most intriguing drama in Corporate Nigeria in recent memory, Tony Elumelu, banker cum businessman, has reacquired the Transnational Corporation shares bought by billionaire Femi Otedola just last week.

For context, Otedola had, in mid-April, confirmed his acquisition of 2,245,639,251 units of Transcorp’s shares, which amounts to a 5.52 percent stake, making him the second largest shareholder of the company. Not done, Otedola acquired additional shares, upping his interest to 6.3 percent.

A statement by Funmi Olofintuyi, Company Secretary, Transcorp, confirmed the transaction, adding, “The Company welcomes this expression of confidence in its leadership and management as we continue our unwavering commitment to superior stakeholders’ returns, anchored in our ideology of Africapitalism. Rest assured of our commitment to remain resolute in executing our group’s strategy of making strategic investments in key sectors within the Nigerian economy, our transformation agenda, and our ability to contribute positively towards building prosperity for all.”

Elumelu, chairman of Transcorp and its largest shareholder, also went on TV to applaud Otedola’s investment in the company while reminding viewers that they share a very good relationship that dates many decades back. “I follow only two people on Instagram, Femi Otedola and my wife; that tells you the level of friendship that we have. He is a man I admire. I welcome his investment in Transcorp. When friends and the investing public invest in a company, it is a validation, it shows that they believe in your story, they believe in your leadership, vision, and competence,” Elumelu said, adding that he looks forward to working with him so that they can take Transcorp to greater heights.

Otedola posted a clip of the interview on his Instagram page and wrote, “Well done Tony Elumelu, my friend and astute investor. The admiration and respect is mutual. One love bro.”That was just Thursday, April 27, morning.

By the end of that day, the story had changed, exposing the hypocrisy, timidity, and fear of Elumelu.

When Otedola bought the shares, he said the conglomerate was underperforming and that he looked forward to a turnaround in its management and fortunes. He should know. Otedola was on the Transcorp board when it was founded by the President Olusegun Obasanjo administration. Thus, he knows, to a large extent, where its skeletons are buried. Elumelu knows a potent threat when he sees one.

He lost sleep thereafter.

He reasoned that Otedola as the largest shareholder would not only expose the seamy underbelly of the conglomerate, it would expose alleged dirty dealings. Otedola coming on board was a debilitating threat. And Elumelu went all out to ensure that it did not happen culminating in the reacquisition of the shares.

He reportedly paid a 400-percent premium on Transcorp’s closing price on Thursday to acquire 9,697,189,984 units of shares thus, bringing his shareholding to 25.58 percent of Transcorp Plc’s outstanding shares.

So far, on paper, Otedola is the gainer here, making quadruple the profit on a barely three-week investment, but those who know his antecedents in the business world know that it is not yet Uhuru for Elumelu.

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1 Comment

  1. AkG
    AkG April 28, 18:58

    Its a chess game, lets the game beginhs

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