Equity CEO James Mwangi (left) and Helen Alexander, a member of the management board of ProCredit Holdings, during the signing of a deal that will see Equity Group acquire ProCredit Bank Congo on May 26, 2015. PHOTO | SALATON NJAU
By VICTOR JUMA, vjuma@ke.nationmedia.com
Equity, which is Kenya’s largest lender by customer base, said it was buying the combined interest in ProCredit Bank Congo from three institutional investors: German firm ProCredit (61 per cent), Belgian development finance institution BIO (six per cent) and Dutch fund DOEN (12 per cent).
The acquisition is partly being financed by share swaps though the exact number of shares and the strike price were unknown by the time of going to press.
Equity has expressed its preference for financing acquisitions through issuance of own stock and recently created 411.4 million new shares with a par value of Sh205.7 million to this end.
Based on the current share price of Sh47.5, the new shares are worth Sh19.5 billion.
Equity’s chief executive James Mwangi said the deal, which is awaiting regulatory approval in Kenya and DRC, is the first of an ambitious Pan African expansion drive that will see it venture into nine more countries.
“We see major opportunities in DRC and ProCredit is compatible with Equity in culture and capabilities,” Mr Mwangi said.
“After this we will expand into southern African markets as we seek a presence in 15 countries in 10 years,” he said, adding that the target markets include Zimbabwe, Bostwana and Malawi.
The deal positions Equity as the first Kenyan bank to venture into DRC.
CREDIT: BUSINESS DAILY
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