Unity Bank faces dissolution as Providus merger nears

A Federal High Court sitting in Lagos has ordered a meeting of shareholders of Unity Bank Plc to consider and approve a proposed merger with Providus Bank Limited, in what could be one of the most significant banking consolidation moves in recent years.

The order, issued by Justice D.I. Dipeolu on July 17, 2025, directs that a meeting of holders of the fully paid-up ordinary shares of Unity Bank be convened to approve the scheme of merger. The meeting is scheduled for September 26, 2025, at the OOPL Hotel, Abeokuta, Ogun State, at 9:00 a.m.

According to the notice, “the Scheme is explained in detail in the Explanatory Statement contained on Pages 17 to 23 of the Scheme Document.” Copies of the Scheme Document are being circulated to shareholders.

Key terms of the Unity Bank & Providus merger

At the meeting, shareholders will vote on a series of special resolutions that define the structure of the deal.

The first resolution states:

“That the Scheme of merger as contained in the Scheme Document dated the 25th day of June, 2025, a printed copy of which has been presented at the Court-Ordered Meeting and, for purposes of identification, endorsed by the Chairman, be and is hereby approved; and that the Directors be and are hereby authorised to consent to any modification of the Scheme Document that the Securities and Exchange Commission (‘SEC’), Central Bank of Nigeria (‘CBN’) and/or the Court shall deem fit to impose and approve.”

The merger will see Unity Bank’s assets, liabilities, and undertakings, including real properties and intellectual property rights, absorbed into Providus Bank.

“That the merger of all the assets, liabilities and undertakings, including real properties, and intellectual property rights of the Bank with that of ProvidusBank Limited… be and is hereby approved without any further act or deed,” the second resolution reads.

All pending or future legal proceedings involving Unity Bank will also be transferred to Providus Bank. The notice states:

“That all legal proceedings, claims and litigation matters pending or contemplated by or against the Bank be continued by or against ProvidusBank Limited after the Scheme is sanctioned by the Court.”

Shareholder consideration

Under the terms of the scheme, Unity Bank shareholders will be compensated either in cash or shares of Providus Bank. Specifically, shareholders will be paid ₦3.18 for every share held in Unity Bank or allotted shares in Providus Bank at a defined exchange ratio.

The resolution states:

“That… all shareholders of the Bank shall, after the Scheme is sanctioned by the Court, be paid ₦3.18 for every share held in the Bank in accordance with the terms stipulated in the Scheme, or be allotted 18 ordinary shares of ₦0.50 each in Providus Bank Limited… in exchange for every 17 ordinary shares of the Bank of ₦0.50 each.”

This effectively positions Providus Bank as the surviving entity in the transaction. Another resolution makes this explicit:

“That the certificate of incorporation of Providus Bank Limited shall be the certificate of incorporation of the Enlarged Bank.”

The deal also requires the cancellation of Unity Bank’s existing share capital. Shareholders are asked to approve that: “the entire share capital of the Bank be cancelled and the Bank be dissolved without winding up.”

This indicates that Unity Bank, as a legal entity, will cease to exist after the merger, while Providus Bank will continue as the enlarged entity.

The court has appointed Unity Bank’s Chairman, Hafiz Mohammed Bashir, or in his absence, Managing Director Ebenezer A. Kolawole, to preside over the meeting. Shareholders may attend in person or by proxy.

The notice emphasises:

“Voting at the meeting will be by poll. Shareholders may vote in person or they may appoint a proxy (whether a shareholder or not) to attend the meeting and vote in their stead. The statutory majority required… is a majority representing not less than three quarters in value of the ordinary shares of members present and voting in person or by proxy.”

Shareholders with questions about the scheme must submit them to the Company Secretary on or before 5 p.m. on September 23, 2025.

The register of Unity Bank members will close on September 19, 2025, to determine eligibility to attend and vote. “The right to attend and vote at the Meeting or any adjournment thereof… will be determined by reference to the contents of the register of members of the Bank,” the notice adds.

If approved by shareholders and sanctioned by the court, the merger will formally consolidate Unity Bank into Providus Bank.

The Solicitors to Unity Bank, Adepetun Caxton-Martins-Agbor & Segun, confirmed that they are directed to “seek orders of the Court sanctioning the Scheme and the foregoing resolutions, as well as such other incidental, consequential or supplemental orders as are necessary or required to give full effect to the Scheme.”

The notice concludes by empowering directors to finalise the deal:

“That the Directors of the Bank be and are hereby authorised to take such other actions and steps as may be necessary or required to give full effect to the Scheme.”

Unity Bank’s shareholders now face a crucial decision with this court-ordered meeting set, : vote to approve the merger and effectively dissolve their bank into Providus, or reject what has been framed as a transformative consolidation in Nigeria’s banking sector.