A major breakthrough in the ongoing recapitalisation of rescued banks has been achieved with the emergence of the former Managing Director of Goldman Sachs, New York, Mr. Tosa Ogbomo, as the chief executive designate of Afribank Plc.
Sources confirmed at the weekend that Ogbomo who heads Vine Capital Limited, a private equity firm, that is set to close its acquisition of Afribank, will be named MD/CEO of the bank once all the necessary approvals are obtained from the shareholders of Afribank and Central Bank of Nigeria.
Parties to the ongoing negotiations said at the weekend that there is a tacit approval in place that Tosa would be appointed MD/CEO of Afribank.
Vine Capital's bid for Afribank is being spearheaded by the duo of Ogbomo and Kalil Udalor, also an investment banker from Goldman Sachs.
Ogbomo was the Managing Director, Mergers and Acquisitions, Goldman Sachs and Co., a bank holding company that engages in investment banking, securities services and investment management.
He obtained a Masters of Science degree in Finance from Bentley College, Waltham, Massachusetts in 1993 and an MBA from the Harvard Business School in 1997.
At Goldman and Sachs, Tosa Ogbomo advised and administered financing for clients in the health care industry including Merck, Boston Scientific, Stryker, and Pfizer. He was in charge of the $90 billion hostile takeover of Warner Lambert by Pfizer.
Prior to Goldman Sachs, Tosa rose from associate to vice president and finally to the position of director in Merrill Lynch & Co, a global financial services firm, which was acquired by the Bank of America in 2008.
According to industry sources, Vine Capital's acquisition of Afribank has been signed, sealed and delivered, as initial arrangements with Nigeria's Fidelity Bank Plc and South Africa's Nedbank fell through.
It was gathered that Vine Capital is also in serious discussions with Finbank Plc. The plan by the shareholders of Vine Capital is to acquire Afribank and Finbank and to merge both entities to produce a bigger bank that has the scale to match the likes of First Bank of Nigeria Plc, United Bank for Africa Plc and Zenith Bank Plc.
The planned acquisition of Finbank is said to have received the CBN's recognition as a core investor of the bank.
The source disclosed that if Vine Capital is able to close the transaction with Finbank, it will improve its chances of merging the two banks.
“The emerging entity might be the fifth or sixth largest bank in the country,” the source said.
However, industry sources have alluded to the fact that First City Monument Bank, which had earlier pulled out of the Finbank deal, has renewed its interest in the bank.
The source explained that Vine Capital showed up in Nigeria with its funding partners several weeks ago to meet with the board of Finbank and allay doubts about its ability to finance the transaction alongside an Afribank deal. This is said to have been a key concern of the board.
The board of Finbank was said to have been very impressed by the dynamic leadership of the group in the person of Tosa Ogbomo.
A shareholder, who would not want to be named, said: “We clearly see the logic in the transaction and strategy. If successful, the combination will be a bank to watch out for.
“We expect the resulting bank to introduce new a paradigm of competition in the industry.
“There should be no concern about Vine Capital being new as all that is required is a world class institution that can drive the successful integration of the two banks.”
He said the coming on board of Vine Capital and African Capital Alliance into the nation's banking sector would change the course of banking in the country.
African Capital Alliance is in negotiations to acquire Union Bank of Nigeria Plc.
He said: “Afribank and Union Bank present a more interesting situation, and may be real game changers. These two banks are being acquired by private equity firms backed by foreign capital, signifying a new wave of confidence in the Nigerian market.
“We have learned that the approach that these two consortia have taken in the approach to negotiating their transactions have elevated the way deals are done in the market place.
“Expectations are therefore quite high that these two consortia and their management teams will raise the standards and quality of banking in Nigeria up several levels,” he said.