Mr. Femi Otedola, a Nigerian businessman and philanthropist, has reportedly sold his stake in Transcorp Plc.
Otedola, a serial investor, had acquired a 6% stake in Transcorp through a series of carefully orchestrated purchases that went almost unnoticed until the acquisition was announced.
The negotiations that led to the agreement were quick but cordial, with both parties agreeing that it was in their mutual best interests to part ways.
According to Nairametrics, Elumelu purchased Otedola at a premium of 4 to 6x the current market price of the share, and an announcement of the transaction is expected on the Nigerian Exchange soon.
The decision effectively averts a potentially messy greenmail situation for Transcorp. Both parties began talks about a possible exit in the early hours of Thursday after declaring their willingness to collaborate in an apparent bromance.
According to the report, the negotiations leading up to the agreement were quick but cordial, with both parties believing it was in their mutual best interests to part ways. Elemelu and Otedola publicly agreed to work together to advance Transcorp’s interests.
According to sources, the attention drawn by the jostle for shareholding was a distraction for the company, paving the way for a decision to part ways. It is expected that both parties will continue to explore other forms of collaboration related to their shared interest in the power sector.
Confirmed sources from Elumelu’s camp who spoke exclusively to Nairametrics explained that the transaction closed at the current market price of Transcorp Plc as of April 27th, 2022. According to Otedola’s camp, the billionaire exited at a premium to his average cost, pocketing a profit.
However, the transaction is about to be announced on the Nigerian Stock Exchange.
Mr. Otedola announced in early April that he had acquired 5.05% of Transcorp, making him the company’s second-largest shareholder. The purchase immediately triggered a rally in the stock’s share price, which more than doubled in less than two weeks.
Meanwhile, in response to Mr. Otedola’s acquisition, Elemelu consolidated his holdings, increasing his ownership stake to about 25% which he announced on April 26th, 2023.