Zenith Bank, one of Nigeria's tier-1 banks, has successfully raised ₦350.46 billion ($226 million) in a rights issue and public offer, exceeding its target and cementing its position as a major player in the country's banking sector. This development comes as commercial banks in Nigeria scramble to meet the Central Bank's minimum capital requirements, which are set to take effect in March 2026.

The rights issue and public offer, which opened in August 2024, were oversubscribed, allowing Zenith Bank to reach its target with time to spare. The bank plans to use the funds to expand its operations in Africa and Europe, demonstrating its ambition to grow beyond its Nigerian roots. This move is seen as a significant milestone for the bank, which has a market capitalization of N1.56 trillion.

In related news, Access Bank, another tier-1 bank, was the first to meet the recapitalization target, raising ₦351 billion ($228 million) in December 2024. While Zenith Bank's success is a positive development, smaller commercial banks, which need to raise ₦250 billion ($160.7 million), are expected to face an uphill task in meeting the deadline.

In a separate but significant development, Java House, the largest coffee chain in East Africa, has been sold to two Africa-focused private equity firms, Alterra Capital and Phatisa Group. The deal, which is expected to be finalized by the end of January 2025, marks the fourth sale of the coffee chain in just 12 years, highlighting its enduring appeal to investors.

Actis, the London-based private equity firm that previously owned Java House, has reportedly been looking for buyers since 2023. The sale to Alterra and Phatisa is seen as a strategic move, with the two firms committed to scaling African businesses. Alterra will hold the majority stake, while Phatisa will take a smaller share but maintain control rights.

Java House, which began as a single coffee shop in Nairobi in 1999, has grown to over 80 branches across Kenya, Uganda, and Rwanda. The group also operates other well-known brands, including Planet Yogurt and 360 Degrees Pizza. The sale is expected to pave the way for further growth, securing Java House's status as a household name in the region.

These developments come as the Nigerian banking sector prepares for a potential wave of mergers and acquisitions, similar to what was seen in 2004 when capital requirements led to a consolidation of banks. With the deadline for meeting the minimum capital requirements fast approaching, expect to see more activity in the sector in the coming year.

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