A Spire Bank branch in Nairobi. Previous attempts by Mwalimu Sacco to sell its stake in the lender collapsed after UK-based crypto lender BlockBank abandoned the deal after expressing interest in 2018. PHOTO | FILE | NMG Kenya’s Mwalimu National Sacco has acquired 100 percent ownership of the trouble-ridden Spire Bank in a tactical move to eventually offload the shares to a strategic investor after close to six years of clinging to an investment that went bust.
The giant teachers’ Sacco finally edged out business tycoon Naushad Merali from the bank in a share-purchase deal deemed as the ticket for attracting deep pocketed investors with much-needed resources and expertise to turn around the loss-making third-tier lender.
Spire Bank’s acting managing director Brian Kilonzo told The EastAfrican that the transaction, which was completed at the end of November, now lays a solid foundation for the struggling lender to attract a strategic investor and kick start its long recovery process.
“This now allows onboarding of a strategic investor to inject funds to ensure regulatory compliance and execution of business growth strategies already developed. This is actively being pursued by the board of directors and shareholders,” said Mr Kilonzo in an e-mail response.
Whether the exit of Mr Merali — the previous majority shareholder and founder of the bank — from the ownership of Spire bank will pave the way for a strategic investor remains to be seen.
The Sacco, which spent Ksh2.4 billion ($21.81 million) on 75 percent of the shares in the bank owned by the billionaire businessman in 2015, has concluded the acquisition of the remaining 25 percent.
The Sacco management declined to disclose the value of the transaction but conservative estimates put the deal at Ksh800 million ($7.27 million) going by the value of the previous acquisitions in which it paid Ksh1.6 billion ($14.54 million) and Ksh750 million ($6.81 million) for 51 per cent and 24 percent stakes respectively.
Previous attempts by Mwalimu Sacco to sell its stake in the bank collapsed after the suitor — UK-based crypto lender BlockBank — abandoned the deal after expressing initial interest in 2018.
A review of the bank’s books of accounts shows that customers have withdrawn over Ksh9 billion ($81.81 million) worth of deposits from the bank over the past six years (2015-2020), with total deposits falling to as low as Ksh4.82 billion ($43.81 million) in the third quarter of this year from a high of Ksh14.3 billion ($130 […]