On the 2nd and 3rd of July, 2025, GTCO, the parent company of Guaranty Trust Bank, announced that it is set to list its shares for trading on the London Stock Exchange (LSE) by 8am July 9, 2025, making it the first financial services institution in West Africa to achieve this feat. At a time when most Nigerian banks are struggling with the recent CBN Circular on Non Performing Loans and forbearance, GTCO once again proves that it is a trailblazer in the Financial sector by making this unprecedented move. This is not GTCO's first foray to the LSE, as it had previously listed its GDR (Global Depository Receipts) there since 2021 or so, which it is about to wind up though.
But what's in it for Shareholders and Investors?
The group concurrently launched a public offer of new ordinary shares to raise $105 million on the London Stock Exchange between July 2 and July 30, through an Accelerated Book Build managed my Citigroup. According to BusinessDay news, "an accelerated bookbuild is a quick method of raising capital, typically completed within 24 to 48 hours. It involves offering shares to institutional investors at a discounted price compared to the current market value. According to the release, shares will be offered to select institutional and qualified investors in the UK, the U.S., and other jurisdictions in accordance with applicable securities laws".
A total of approximately 2.29 billion new ordinary shares in the company will be issued in US dollars at a reference (offering) price of ₦70 per share ($0.0459), a discount to its last trading price (₦83.20) on the floor of the Nigerian Stock Exchange, raising gross proceeds of $105 million. This is in fulfilment of the CBN's directive to all Nigerian banks with international authorization to recapitalize to a minimum of ₦500 billion on or before March 31, 2026.
The group also gave notice of its intention to cancel the listing of its existing GDRs due to low trading volume since its listing. In place of the GDR listing on the LSE, GTCO intends for all its ordinary shares to be admitted to the equity shares (International Commercial companies secondary listing) category of the Official list of the FCA and to trading on the main market for listed securities of the London Stock Exchange. It is expected that the admission and dealing in GTCO shares on the LSE will become effective on or before 8am (UK time) on the 9th of July 2025 under the ticker "GTHC". Following the cancellation of the GDRs listing on July 31, the company intends to change the ticker symbol for the shares from "GTHC" to "GTCO". The group's issued share capital post admission to the LSE, will be 36,425,229,514 shares.
The group clarified that the move will not affect its domestic listing. Shares will continue to be quoted and traded in Nigerian Naira on the Main Board of the Nigerian Exchange Limited (NGX) under the existing symbol “GTCO”. Post-admission, the company also expects that its shares will be transferable between the LSE and NGX, subject to meeting specific requirements.
Now back to the question, what's in it for shareholders and investors?
Taking a cue from dual listed Nigerian companies already listed on the LSE like Seplat and Airtel Africa, the interchangeability of a company's stock between both NGX and LSE (i.e. the same shares can be traded across both NGX and LSE) can improve liquidity of its shares, and help the shares have better appreciation for its earnings vis a vis price. Meaning that as against the low Price-earning ratios prevalent for most companies on the NGX especially banks, with dual listing the Price-earning and Price to book ratios may begin to appreciate, seeing GTCO's share price find a new higher level. A lot of foreign investors who are not convinced to bring their money into Nigeria and invest in say GTCO directly would now be able to do so via the London Stock Exchange, without the fear of FX liquidity challenges when they want to withdraw their moneys as many of them had experienced in the past. This is also much smoother than the GDR program which was less fungible.
In addition, this scheme will provide investors with greater flexibility and broader access, while strengthening GTCO's ability to raise capital more easily in the international space.
So we would not be surprised to wake up in a few months and discover that GTCO shares has repriced by up to 40% or more from where it is today- which is very possible when Hard currencies chase Naira denominated assets. This could just be the best news yet for GTCO Shareholders and prospective investors. Thumbs up to the management and board of GTCO for this brilliant move! Let's see how the markets reward it. We hope that as GTCO led with the handling of the forbearance scheme with the CBN while other banks followed, that other banks would step up their game and take a cue from this so that their shareholders and investors can reap the benefits accordingly.
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