5 Business Lessons from Aig-Imoukhuede and Herbert Wigwe’s Takeover of Access Bank
Endurance, consistency and a clear vision of the desired goal are themes that resonate through their story.
The story of how the duo of Aig-Imoukhuede and Herbert Wigwe as young bankers at 36 successfully bought controlling shares of a struggling bank and were able to turn around its fortunes within the space of two decades holds a lot of lessons for young entrepreneurs, businessmen and women.
Staying power, consistency and a clear vision of the desired goal are themes that resonate through their story.
Described as one of the most audacious takeovers in the history of the nation’s financial industry, the duo went on to turn a small, nondescript bank into an enviable financial powerhouse.
Under their leadership, Access bank successfully raised N15 billion via a public offer, acquired Capital and Marina, two smaller banks, and got FMO, a Netherland development finance company to become an institutional investor by converting a $15 million loan to equity.
Today, Access Bank which recently celebrated its 20th year under the new leadership stands as one of the biggest banks in Nigeria by deposits and assets and has a growing presence in eight countries across Africa and the UK.
How They Met
The duo met at GTB where they both rose through the ranks to become Executive Directors. There, they realized they both shared a common desire to own their banks.
Aig in his recently launched book, Left on the Tarmac: Buying a Bank in Africa, shared what motivated him to make his mind never to be caught on the sidelines in life ever again but to always take the frontline role wherever he found himself.
According to him, as a young student on his way to Lagos, he was edged out of a flight during the ensuing scramble:
“When the airport staff announced that the plane was ready for boarding, there was suddenly a mad scramble as the more experienced passengers leapt to their feet and dashed out to get on board. As I struggled towards the plane with my suitcase, I was elbowed out of the way by many people much bigger and stronger than me.”
By the time he got closer, it was too late, “As I stood with my suitcase, watching the plane take off without me, tears streamed down my face,” he writes, “and I vowed that never again would I be left behind on the tarmac while everyone else was flying off.”
This experience probably gave birth to the strong foresight he had about the banking industry back then in line with his ambition, “By 2000, I knew that if the banking industry took off without me in it as owner I would be left standing on the tarmac, a very frustrated professional with little hope of making my entrepreneurial vision a reality.”
Driven by a Desire
Driven by their desire to both own a bank of theirs, their idea to achieve this was either to buy off a bank not too strong or get one doing fairly well.
Unfortunately, they soon realized that either of these was not possible. For the banks that were doing fairly well, they were too expensive for them while those that were affordable were in bad financial condition or had so far been run against the principles that were in line with what they stood for and wanted to be known for.
The opportunity, however, came up when the issues Access Bank had been contending with came to the fore.
Access Bank had been embroiled in a wide range of malpractices surrounding foreign exchange transactions and for which it had come under the scrutiny of the Central Bank.
However, all attempts to turn its fortunes around yielded no positive impact on its records. Even the hiring of management consultants and poaching of top executives from GTB to help turn around its fortunes did little to help the struggling bank.
By 2001, in another attempt to boost its books, it launched a N1billion public offer which unfortunately didn’t see a good turnout from the public.
With the offer’s closing date beckoning and lacklustre response from the buying public, the duo saw this as an opportunity to hit the target they had been planning on since 2000.
Challenges Faced by Aig-Imoukhuede & Herbert Wigwe
Despite stiff opposition both from within the bank (the bank’s board members were not disposed to the majority share of the bank being bought over by two young bankers) and the CBN (who delayed the approval process on the basis that they were too young to own a bank) they nevertheless succeeded in paying the N1billion (about $9 million) after successfully raising the balance of N800million in addition to the N200million they had.
On why he and Herbert decided to go on with the investment even though they did not conduct due diligence other than an overview analysis, Aig-Imoukhuede stated thus:
“Despite the fact that we conducted no due diligence, doing little more than a ‘back of the envelope’ analysis, we found Access attractive for a number of reasons.
Firstly, its board of directors included men of integrity who were well-respected in business circles. Secondly, the bank was quoted on the Nigerian Stock Exchange10, which implied some minimum standards of governance, and thirdly, its financial safety indicators did not point to an institution that was on the verge of failure.
“While our decision to take up the unsubscribed shares was in effect a leap of faith (endorsed, I would like to point out, by the pastor of my church), it was our belief that since we would be controlling the management of the Bank we were recapitalising, the risk of losing our investment was almost entirely in our own hands,” he wrote.
Here are vital lessons to pick up from the story of Aig-Imoukhuede & Herbert Wigwe:
Friendship: From their story, it is clear that both men were first friends who realized they both had similar desires in life. This shows the importance of having quality associates and friends. This helps shape and fire up desires when ideas are exchanged between mutually motivated individuals.
Collective effort/synergy: The Aig-Imoukhuede, Herbert Wigwe ‘partnership’ teaches the salient lesson of synergy and collective effort. Young entrepreneurs must seek out partnerships that build them up and through which they can achieve their goals faster.
Principles and Values: When digesting Aig-Imoukhuede’s book, one of the points that easily comes up is that of the place of knowing you as a person stands for. A guiding principle he stressed in their search for a struggling bank to buy was the principles and Values upon which such was being run.
This is because like he said, “The ability to sustain the change required to turn around a distressed bank depends more on the quality of its leadership and the strength of its values than the expertise of the management consultants who are engaged to try and put things right.”
Not all deals you come by as a business person will align with your values and should this be the case, the discipline to let go must be adhered to else, you might eventually get your fingers burnt.
Resilience & Grit: Resilience and grit as themes resonate all through the story of the duo. Their pursuit to buy over a bank was sorely tested as they met with so many brick walls. This, however, did not deter them as they trudged on.
Preparation: After all is said and done, when the opening they had been looking for showed up, they were ready, both mentally and capacity-wise to clinch it. Entrepreneurs must always stay ready and prepared to maximize opportunities as they do not forewarn.
READ ALSO: How Nigerian Business Magnate Dele Fajemirokun Became a Billionaire at 29
3 Failed Businesses Aliko Dangote Owned
Aliko Dangote, a poster boy for Africa’s undeniably successful businesses, is one of…