Access Bank Holding Plc says it plans to acquire Kenya’s Sidian Bank Limited for N15 billion ($37 million).
This was disclosed in a notice signed by Sunday Ekwochi, Company Secretary of the bank, on Wednesday in Lagos.
The notice, made available on the website of the Nigerian Exchange Limited, said its subsidiary, Access Bank, had signed agreement with Centum Investment Company Plc for the acquisition of the entire 83.4 per cent equity stake held by the company in Sidian Bank Limited.
Centum Investment Plc is a leading East Africa investment firm listed on the Nairobi Securities Exchange and Uganda Securities Exchange.
It noted that the purchase consideration is approximately up to N15 billion ($37 million), representing a price to book multiple of 1.1x based on the audited March 31, 2022 shareholders equity of Sidian.
According to the bank, Sidian will be merged with Access Bank’s subsidiary in Kenya, Access Bank Kenya, to create a stronger banking institution better positioned to serve Kenya market.
The Chief Executive of Access Bank, Roosevelt Ogbonna, said that the transaction builds on the bank’s earlier acquisition of the former Transnational Bank Plc, now Access Bank Kenya.
Ogbonna said the transaction also underscores the bank’s resolve to strengthen its presence in Kenya, a key African market that fits into its strategic focus for geographic earnings growth and diversification.
He said: “The acquisition and intended subsequent merger will create a strong and competitive balance sheet for Access Bank Kenya, positioning us to be well-placed to promote regional trade finance and other cross border banking services in the East African Community (EAC) and broader COMESA region.
“The proposed combination with Access Bank Kenya would undoubtedly propel Access Bank into a strong contender in the Kenyan market with enhanced capacity to play a more impactful role in the growth of its economy while delivering increased profitability for our shareholders.”
Also, the Group CEO of Access Holdings Plc, the parent company of Access Bank, Herbert Wigwe, stated that the deal “represents the relentless focus and execution of our strategic objectives within our banking subsidiary even as we grow the other businesses within Access Corporation’s core segments.
“The acquisition of Sidian is a significant step-up in scale and potential for Access Bank in Kenya which represents the largest market and trade corridor in East Africa.
“The significant increase in scale and customer base presents us with enormous opportunities to support growth in the various ecosystems were are building in our trade and payment business.
“The economies of scale that derive therefrom will continue to drive and enhance contributions to all stakeholders.”
Also in the notice to the NGX on the proposed purchase, it was stated that the valuation was based on the audited results of the Kenyan lender for the first three months of the year.
The deal is still subject to regulatory approvals in Nigeria and Kenya.