Nedbank completes takeover of Kenya's NCBA in about Sh110 billion deal
South Africa's Nedbank has completed its purchase of a 66% stake in Kenya's NCBA Group, a deal worth about 110 billion Kenyan shillings. NCBA keeps its brand, Nairobi headquarters and stock listing. The Kenyatta and Ndegwa families are cashing out most of their stakes.
South Africa's Nedbank Group has completed its takeover of a 66% controlling stake in Kenya's NCBA Group, making the Nairobi lender a subsidiary of the Johannesburg-listed bank, The Standard and The Star reported.
Nedbank announced on Oct. 19 that all conditions for the deal had been met after it received the required regulatory approvals, The Star reported. The deal is valued at about 13.9 billion South African rand, or about 110 billion Kenyan shillings. The Standard put the figure at 109.6 billion shillings. Eighty percent of the price is being paid in new Nedbank shares and 20% in cash, The Star reported.
The deal was cleared by the Central Bank of Kenya and by regulators in South Africa, Tanzania and Rwanda, along with the COMESA regional competition authority, The Standard reported.
It is a windfall for two of Kenya's best-known banking families. The Kenyatta family, through Enke Investments and direct holdings by Muhoho Kenyatta, and the Ndegwa family, through First Chartered Securities, are cashing out most of their stakes, The Standard reported. Both families keep minority stakes.
Shareholders will wait a few weeks to be paid. The settlement date is Oct. 21, but cash and Nedbank shares will be handed over around Nov. 3, The Standard reported. NCBA shares will stop trading on the Nairobi Securities Exchange from the close of business on Oct. 21 until Nov. 2. The other 34% of NCBA stays with public investors and will keep trading.
NCBA said business will continue as usual, keeping its brand, local leaders, headquarters and branches. "The name is the same, the people are the same, but the ambition and capabilities are tremendously magnified," Managing Director John Gachora said.
For Nedbank, the deal brings instant scale in East Africa through NCBA's 122 branches in Kenya, Uganda, Tanzania, Rwanda and Ivory Coast, The Standard reported. Nedbank CEO Jason Quinn said it "establishes a significant presence for Nedbank in East Africa."
What we know: Nedbank now controls 66% of NCBA, and payouts begin around Nov. 3.
What we don't: How Nedbank will change NCBA's strategy or leadership over time.
Where outlets agree The Standard and The Star both report that Nedbank completed its purchase of a 66% stake in NCBA, with NCBA keeping its brand and Nairobi listing.
Where they differ The cited reports agree on the key facts so far.