Fate of National Bank of Kenya sealed as KCB gets takeover nod


Fate of National Bank of Kenya sealed as KCB gets takeover nod
A customer transacting at an Automated Teller Machine inside KCB's Moi Avenue Branch (Kencom) PHOTO | REUTERS

Kenya Commercial Bank has obtained approval from the Capital Markets Authority to take up National Bank of Kenya.

This ends the lacklustre operations of NBK in Kenya’s financial services sector.

“We are thankful and excited for the goodwill and support we have received from the shareholders, our regulators and all other stakeholders,” said KCB Group Chief Executive Officer Joshua Oigara.

KCB Group had offered to swap every 10 of NBK shares with one of its listed shares.

The 87.7 per cent acceptance from NBK shareholders, surpassing the 70 per cent regulatory approved threshold.

The remaining 12.3 per cent shares will therefore be acquired by KCB Group at the prevailing rates.

NBK will also in the coming days be delisted from the Nairobi Securities Exchange.

The new KCB Group shares will also be uploaded in its share register before the deal is completely sealed.

APPOINTED BOSS

Beginning October, NBK will now operate as a subsidiary of KCB Group.

This expected to last not more than two years as plans to fully assimilate it are put in place.

Already KCB Group has appointed Paul Russo as managing director NBK in the period.

During the transition, KCB Group has indicated it will not interfere with the daily operations of its new subsidiary.

The appointment of Russo however gave the strongest hint that it would reorganiSe its management.

MARKET LEADER

KCB Group priced National Bank of Kenya at a steeply discounted Ksh.5.6 billion with the sale being pegged on the acquirer’s ambition of consolidating on its market leader’s position.

This under a targeted value position of Ksh.1 trillion in what will make up East Africa’s largest bank.

The close of the deal announced first in mid-April comes ahead of the receipt of the merger between the Commercial Bank of Africa (CBA) and NIC Group.

This transaction remaining in gridlock, due to among others an ongoing litigation to stop the marriage between the two lenders.

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Story By Kepha Muiruri
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