Femi Otedola, the wealthy businessman made a failed N250bn bid to seize control of Transcorp Plc according to a note he delivered on Tuesday.
According to Otedola, “I offered to buy Transcorp Plc for N250 billion, but unfortunately, my offer was rejected.
“My goal was to maximise the company’s potential as a Nigerian conglomerate with a market cap of at least N2 trillion instead of the current N40 billion, but it seems some shareholders have a different vision.
“As a businessman, I believe in healthy competition and market dynamics. Two captains cannot man a ship, and I respect the majority shareholder’s decision to buy me out. This is the nature of the game.”
Otedola says his offer to take over Transcorp was made in good faith but some analysts have said the bid came as a surprise to current chairman of Transcorp Tony Elumelu, another wealthy businessman who mounted a swift defence to put Otedola at bay.
It is not the first time that the two billionaires have faced off said Otedola who is the majority shareholder in Geregu Power which was listed on the exchange last year and has since seen an astonishing appreciation in share price.
Otedola added, “In 2005, while Tony was the Managing Director of Standard Trust Bank, he approached me to get funds to acquire UBA. I enthusiastically gave him $20 million, which was N2billion at that time to buy the necessary shares in UBA for the acquisition.
“After a short period of time, the share price moved up and I decided it was a good moment to sell and get out of the bank. However, Tony appealed to me to hold on to the shares as he was convinced that there were future prospects – so I kept the shares. “I became Chairman of Transcorp Hotel in 2007 with a shareholding of five percent and unknowingly, Tony gradually started buying shares quietly.
“By the following year in 2008, I went bankrupt in Nigeria. Tony proceeded to take my shares in UBA to service the interest on my loans and he also took over my shares in Africa Finance Corporation, where I was the largest shareholder.
“Shortly after, Albert Okumagba informed me that an American firm wanted to acquire my shares in Transcorp, which I then agreed to sell. However, this supposed American firm turned out to be Tony Elumelu. The revelation of this prompted me to resign as Chairman of the hotel.
“Years later in 2012, Tony said he wanted to see me, so we met in my office where I had previously had a meeting with foreign investors who had not yet departed the premises. Curious to know, he asked what sort of meeting I had had and I disclosed that I wanted to go into the power business, specifically Ughelli Power Plant. Tony quietly went ahead to bid for Ughelli and he outbid me by offering to buy the plant for $300 million.”
Otedola insists that his move was “made with the best intentions for Transcorp Plc and its shareholders. I saw an opportunity to unlock the company’s full potential and create value for everyone involved.”
He noted that it was “important for investors to understand that free entry and free exit are crucial to healthy markets. The scramble for shares after my acquisition is a testament to the value that Transcorp Plc can offer, and I hope the company continues to thrive under new leadership.”
“I remain committed to the growth and success of Nigerian businesses, and I will always be looking for ways to create value for all stakeholders. Stakeholders are unfortunately always shortchanged by getting stipends while the owners and managers of the business live a jet-set lifestyle, which is detrimental to the stakeholders.”