Kenya: KCB in Process of Acquiring BPR

26 November 2020

KCB Group is in the process of acquiring a 62.06 per cent stake in Banque Populaire du Rwanda Plc which is owned by Atlas Mara Group.

KCB Group, a Kenyan based financial services holding company with presence across the region and Atlas Mara on Wednesday, 25th November 2020 entered a share purchase agreement for the purchase of 62.06 per cent of the issued share capital of Banque Populaire du Rwanda.

KCB will pay a cash consideration for the BPR shares determined based on the net asset value of BPR at completion of the transaction.

The New Times understands that KCB Group intends to make an offer to the remaining shareholders of BPR to acquire additional shares from the remaining shareholders and will offer the same acquisition price applicable to the shares to be acquired from Atlas Mara Group, according to a statement from KCB Group.

The process is subject to approval by various regulatory bodies including Central Banks of the two countries, Capital Markets Authorities among others.

Prior to the new deal, Equity Bank Group in April 2019 expressed intention to acquire 62 per cent stake in Banque Populaire du Rwanda Limited (BPR) but in January 2020 announced the suspension of the process.

BPR Managing Director Maurice Toroitich and KCB Bank Rwanda's Managing Director George Odhiambo confirmed the development to The New Times.

Toroitich said that when complete, the two banks will merge into one entity with BPR being included in KCB Rwanda's operations.

"The only thing left is approval by regulators and shareholders, KCB will then have a plan on how to take forth the merger," he said.

The new entity following the merger will be one of the largest players in the local market in terms of clients, assets and national footprint.

Odhiambo said that the merger will see the bank ranked 2nd largest bank in the country, increasing scale and improving operating leverage to deliver existing retail and wholesale offerings.

"This merger will see the bank ranked 2nd largest bank in the country, which will increase our scale and improve our operating leverage by enabling us to deliver existing retail and wholesale offerings to a wider base of customers in Rwanda while positioning the bank for sustainable growth in the long-term," Odhiambo said.

While the timeline of the process is not clear, Toroitich said that the process is expected to be complete quickly.

Toroitich said that the development will not disrupt or affect any of the current ongoing business at the bank including issuance of loans and credit facilities.

"We are continuing everything we have been doing. This is a merger of growth not of cutting. The intention is to create a bigger business and our customers can look forward to being part of a regional bank," he said.

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