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KCB spends Sh6.3bn to buy Rwanda bank

KCB spends Sh6.3bn to buy Rwanda bank

KCB Group #ticker:KCB spent Sh6.3 billion to acquire Banque Populaire du Rwanda Plc (BPR) from London-listed Atlas Mara Limited and other investors.

The country’s second-largest bank by assets completed the deal on August 25, paying Atlas Mara $33 million (Sh3.6 billion) to acquire its 62.06 percent stake in the lender.

Atlas Mara will get an additional $2.8 million (Sh311 million) which has been deferred. Former minority investors of BPR, who owned a combined 37.94 percent equity, got $21.9 million (Sh2.4 billion).

Details of the transaction price have been disclosed by Atlas Mara which was the first to sign a deal with KCB before the former minority shareholders joined to sell their stakes on the same terms.

KCB also signed a deal with Atlas Mara to acquire its Dar es Salaam-based subsidiary African Banking Corporation Tanzania.

“The transaction, which has been approved by the Bank of Tanzania, is now subject to fulfilment of customary conditions precedent. Sale of ABC Tanzania is expected to be concluded before the end of the year,” Atlas Mara said.

The cost of the Tanzania transaction was initially estimated at Sh806 million.

Atlas Mara is selling its African banks to KCB and other lenders to raise funds to pay its creditors, some of whom had launched liquidation proceedings against the multinational that was the brainchild of former Barclays Plc’s chief executive Bob Diamond.

KCB says the acquisitions reflect its strategy of expanding its operations in the regional market. Big banks led by Equity, KCB, I&M and DTB have been deepening and expanding their presence in the region in pursuit of growth and diversification.

Uptake of financial services in the neighbouring countries are lower than Kenya, signaling future growth opportunities.

The ability to offer seamless services to clients across multiple markets is also seen as advantage in attracting and retaining multinationals.

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