I&M Holdings, a Nairobi Securities Exchange-listed firm has stormed into the Ugandan financial market in style by acquiring a 90% stake in Orient Bank Limited, Taarifa reliably reports.
“This acquisition is expected to give the group greater capacity to grow profitably, through extending our network to our regional customers,” I&M’s executive director Sarit Raja Shah said in a statement.
Since 2014, I&M had been eyeing the Ugandan market in pursuit of growth and regional diversification strategy that is also seen among rivals like KCB Group, Equity Group and DTB Group.
The Kenyan banking multinational bought shares from Orient Bank’s shareholders Hemlata Karia, Jay Karia, Morka Holdings Limited, Zhong Shuang Quan, Cornerstone M8 Limited and the bank’s founder Ketan Morjaria.
This deal adds to I&M’s regional banking operations comprising Kenya, Rwanda, Tanzania and Mauritius.
Morjaria, who held a 7.91% stake before the transaction, sold part of his shares and retains a 5.5% equity in the subsidiary.
Alemayehu Fisseha did not sell his holdings and also retains a 4.5% interest in the bank. “This acquisition marks a great milestone in the history of Orient Bank,” Dr. Morjaria said in a statement.
“We are proud to be integrating into a regional group like I&M Holdings Plc and this synergy will allow our customers to benefit from more seamless and superior banking products whilst continuing our tradition of trust.”
I&M had said that the U$33.5million purchase price would be subject to further adjustments on account of several factors including exchange rate fluctuations and the amounts raised from the sale of the Ugandan bank’s property in Kampala (Orient Plaza).
I&M said of the Orient Bank buyout in a circular to shareholders, “The combined group will be better able to serve the needs of regional and global customers, and in turn promote regional trade flows.”
