Earlyface

Zenith Bank PLC expects the approval of British authorities for it to list up to $850 million of its shares later this month on the London Stock Exchange (LSE) as global depository receipts, a banker close to the deal said on Tuesday.

The London Stock Exchange said last week it expected an increase in new listings from African companies this year as businesses in the continent’s fast-growing economies seek to attract foreign investors.

Zenith said in October the secondary listing was aimed at improving liquidity in its stock rather than raising capital.

Zenith has all necessary approvals from Nigerian authorities to go ahead with the listing, the banker said, adding that the deal will enable foreigners who prefer to hold dollar assets to invest in the bank.

“Investors can only switch a maximum of $850 million worth of local shares into the GDR programme,” the banker said, adding that the GDR price will be based on the naira exchange rate and the local share price of Zenith Bank.

“Hopefully, it will be listed within two weeks,” the banker said.

Zenith Bank has a primary listing in Nigeria with a market capitalisation of N674.7 billion ($4.3 billion), based on Tuesday’s close of N21.49 per share.

One GDR will represent 50 ordinary shares, the bank said.

JP Morgan is acting as the depository bank, while Citi Bank will act as the custodian.

The LSE is already home to 96 companies whose main operations are in Sub-Saharan Africa, including 23 which have shares listed on its main market.

With this listing, Zenith Bank is expected to join three other Nigerian lenders with GDRs trading in London — Guaranty Trust Bank, Diamond Bank and First Bank.