Equity Group Managing Director James Mwangi addresses investors during the bank’s quater 3 update on November 12
Equity completes purchase of stake in Congolese bank for Ksh.10.3 billion
Equity Group has completed the acquisition of a 66.53 per cent bank in the Commercial Bank of Congo (Banque Commerciale du Congo).
The deal which doubles on the local bank’s presence in the Democratic Republic of Congo (DRC) follows the completion of a share purchase agreement with George Arthur Forrest- the bank’s majority stakeholder.
Equity Group has revealed its payment of Ksh.10.3 billion for the controlling stake following a discount of Ksh.1.1 billion occasioned by among other factors- the COVID-19 pandemic.
“Equity Group Holdings is pleased to inform its shareholders and the public that conditions precedent to the acquisition including the receipt of corporate and regulatory approvals have been fulfilled and/or waived and the acquisition was completed on August 7,” the bank noted in a statement on Tuesday.
The Commercial Bank of Congo (BCDC) will now become a subsidiary of Equity Group.
Equity already operates in the DRC and will merge the operations of BCDC to its existing subsidiary.
The subsidiary has recently features as Equity’s most improved operations outside its home country topping the charts in both the Profit after Tax (PAT) and return on assets segments.
The subsidiary has further taken leverage from DRC’s stable macroeconomic environment which has featured low inflation rates and a stable forex exchange regime.
The acquisition of the bank sits along with Equity’s goal of becoming a Pan-African bank with sound footing across the region.
This plan has however been slightly derailed by the pandemic, with the bank cancelling its Ksh.10 billion planned acquisition of Atlas Mara banking businesses in Rwanda, Tanzania, Zambia and Mozambique at the end of June.
Equity Bank is Kenya’s second largest bank by asset base and the first by market capitalization at the Nairobi Securities Exchange (NSE).