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US PE fund ends talks for $1B injection in Nigerian bank, citing threats


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US PE fund ends talks for $1B injection in Nigerian bank, citing threats

New York-based private equity fund Milost Global Inc. ended talks to inject $1 billion into Unity Bank PLC, saying it had been threatened with being run out of Nigeria if it went ahead with the deal, Bloomberg News reported.

Milost had reached an agreement with the Nigerian lender based on the understanding that Unity Bank would transfer its share listing to the U.S. from Nigeria, it said in an email to the newswire. It would have eventually acquired 60% of the Lagos-based bank, which needs capital to strengthen its balance sheet and fuel expansion, Milost Global said.

However, the firm said that as soon as the deal was concluded, it started receiving threatening emails from a person claiming political clout. This was followed by alleged negative reporting in the Nigerian press and a "false statement [by Unity Bank] which denied signing a binding commitment agreement," Milost Global told the newswire.

Earlier, Unity Bank CEO Tomi Somefun told Reuters that talks were on to sell a minority stake to two private investors, in a bid to recapitalize the lender. Without naming the investors, Somefun said they had completed due diligence and that a deal could be closed during 2018.

Unity Bank is planning to restructure operations with a focus on retail banking and small businesses, as well as relocating branches to better serve customers, Somefun added.

Meanwhile, another Nigeria-based lender, ASO Savings & Loans PLC, denied media reports that Milost Global was investing $250 million into the bank, Business Post Nigeria reported.

"We dismiss this claim and wish to state that ASO had at no time issued any notice to Nigerian Stock Exchange (NSE) as purported in the media. ASO Savings & Loans PLC has not entered into any agreement with Milost Global Inc.," the bank's management said.