KENYA – Kenya’s top lender by assets, KCB Group, plans to acquire 62.06% in Banque Populaire du Rwanda and 100% in African Banking Corporation Tanzania Limited for an undisclosed amount, it has said in a statement.
The deal is subject to shareholder and regulatory approvals.
Kenyan commercial banks are looking beyond their borders for acquisitions, seeking to tap growing opportunities in the wider East Africa region, driven by rapid economic growth and trade integration.
KCB will pay cash for the shares in the Rwandan bank, it said in a statement, to be computed using a price to book multiple of 1.09.
“Once the transaction is completed, the Group’s Rwanda and Tanzania businesses are expected to have stronger financial credentials to support business growth in the post-covid-19 macroeconomic recovery”Joshua Oigara – CEO, KCB Group
It also aims to make an offer to the remaining shareholders to acquire more shares on the same terms as the 62% already agreed, KCB said.
In the ABC Tanzania deal, KCB will also pay cash, using a price-to-book multiple of 0.42, the group said.
Both transactions are still subject to various approvals including those of regulators in all three markets, KCB said.
The announcements come barely 5 months after Equity Bank pulled out of a deal that would have seen it acquire the very same assets, sighting risks occasioned by the COVID19 pandemic.
The acquisition of BRP will see KCB Group become Rwanda’s second largest bank by market share while the acquisition of ABC Tanzania will put KCB among the top 10 banks in the country.