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Business News Tue, 30 Jun 2015

ADB to lose shareholders over IPO suspension

ADB bank risk losing prospective shareholders and investors to other institutions offering profitable investment avenues following the suspension of the bank’s Initial Public Offering (IPO).

This is according to Investment Banker, Mahama Iddrisu.

‘’The general economic conditions are very tough for the ordinary Ghanaian so if the offer is delayed, it means that there are so many investment avenues for now so for the many who cannot wait, they will invest their funds elsewhere.’’

ADB was hoping to raise a total of 398,454,178 cedis through its IPO to enhance the operations of the bank but had to postpone it last week over a number of legal and political challenges amidst agitations from some of its workers.

Prominent among them is the suit by the Member of Parliament for New Juaben South constituency, Dr. Mark Assibey-Yeboah who has filed a suit at the Supreme Court insisting the Bank’s initial Public Offer should first be approved by parliament.

This is the second time the bank has had to put its IPO on hold.

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Early this year, government who is majority shareholder of the bank called for a temporary suspension of the IPO following workers agitation.

Mahama Iddrissu in an interview with Citi Business News, said the current challenges with the general economy and the bank has sparked doubts in the business community as investors are likely to critically scrutinize ADB’s offer documents before they make offers.

‘’People will begin to think that information is being withheld in the offer documents and that is going to let people do another scrutiny of the documents’’.

This he says will lead to another challenge as the investment sector is based on trust.

According to Mahama Iddrisu, ‘’If there is not trust in investment banking, trust me there is no hope.’’

Source: Citifmonline.com
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