South Africa’s Nedbank Group has completed its acquisition of a 66 per cent controlling stake in NCBA Group, making the Kenyan lender a subsidiary and giving Nedbank its first major foothold in East Africa.
NCBA said on Monday that the deal closed after it received all required regulatory approvals.
NCBA will remain listed on the Nairobi Securities Exchange (NSE), with the remaining 34 per cent of shares held by the public.
Demand for the offer outstripped Nedbank’s target. By the close of the offer period on July 10, NCBA shareholders had tendered 1.32 billion shares, or 79.9 per cent of the bank’s issued shares.
The excess was scaled back pro rata to bring Nedbank’s holding to about 66 per cent.
NCBA shares will be suspended from trading from about the close of business on October 21 to November 2 to allow the share register to be reconciled.
The shares will then be transferred to Nedbank through a block trade on the NSE on November 3. Payment to tendering shareholders, in Nedbank shares and cash, starts the same day.
“The name is the same, the people are the same, but the ambition and capabilities are tremendously magnified,” said John Gachora, NCBA Group managing director and chief executive.
“With the backing of Nedbank, we are now poised to boldly go after opportunities across the East African region, expand our footprint and bring to market a more sophisticated set of products,” he said.
Nedbank chief executive Jason Quinn said the deal marks “a decisive step forward” in the group’s African growth strategy.
“By connecting two strong banking platforms across Southern and East Africa, we are creating new opportunities for our clients and shareholders, while supporting greater trade, investment and growth across the continent,” Mr Quinn said.
NCBA will keep its brand, local management, Nairobi headquarters and existing products, branches and digital channels, the lender said.
Customers are expected to gain access to Nedbank’s cross-border and sector expertise over time.
NCBA serves more than 60 million customers through 122 branches in Kenya, Uganda, Tanzania, Rwanda, Ivory Coast and Ghana. Its digital lending products, run with Safaricom, account for much of that customer base.
Nedbank, listed on the Johannesburg and Namibia stock exchanges, operates in Namibia, Zimbabwe, Mozambique, Lesotho and Eswatini, with offshore centres in London, Dubai, the Isle of Man and Jersey.
The Nedbank NCBA acquisition deal adds to a wave of South African and pan-African lenders expanding into Kenya’s banking market, one of the most competitive in the region.
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By Nixon Kanali
Tech journalist based in Nairobi. I track and report on tech and African startups. Founder and Editor of TechTrends Media. Nixon is also the East African tech editor for Africa Business Communities. Send tips to kanali@techtrendsmedia.co.ke.