With barely three months to the September 30 deadline for the recapitalisation of rescued banks, Diamond Bank Plc has opened up discussions with the management of Oceanic International Bank Plc and commenced due diligence, preparatory to the possible acquisition of the bank.

Oceanic Bank is one of the eight banks taken over by the Central Bank of Nigeria following its 2009 banking sector audit which led to the ouster of former management teams of the institutions. 

THISDAY learnt last week that Diamond Bank was one of six bidders that have opened up discussions with Oceanic Bank after the merger and acquisition talks between the latter and First Bank of Nigeria Plc broke down last April. 

Sources said the ongoing due process is programmed to end as quickly as possible to enable the two banks cross other hurdles of recapitalisation process should they agree on terms for the acquisition bid. 

CBN sources who confirmed the ongoing talks between the two institutions said Diamond Bank is “currently undertaking due diligence of Oceanic Bank to determine if there is value and if it is worth Diamond Bank's while.

“It is only after that that Diamond Bank can talk of bidding for Oceanic Bank,” the sources revealed. 

Unconfirmed reports also indicated that other bidders said to be interested in Oceanic Bank include ETI West Africa, the parent company of Ecobank (Nigeria) Plc, and Helios Private Equity, the emerging markets private equity firm owned by George Soros, the Hungarian-American foreign exchange speculator, financier and philanthropist.  

Following the breakdown of merger talks with First Bank in April this year, the management of Oceanic Bank announced its resolve to open its doors to other credible strategic investors. 

“We are currently exploring other recapitalisation options including the sale to a credible, strategic investor,” Chief Financial Officer Oyinkan Adewale was quoted as saying. 

First Bank's takeover of Oceanic Bank was said to have broken down over low offer made by FBN for the rescued bank.

The offer was rejected by Oceanic Bank's board and shareholders who felt the banks still had considerable value. 

Financial industry experts at the time had described First Bank as a reluctant investor in the bank as there was speculation that management of the bank was urged by the CBN to bid for Oceanic Bank. 

The CBN had fired eight bank chief executives and their executive directors after a financial industry crisis between 2008 and 2009 threatened the banking industry with collapse. 

The regulator was compelled to bail out eight banks to the tune of N620 billion, with Oceanic Bank as one of the beneficiaries.