Centum Investment Company Plc announces binding agreement to sell its 83.4% equity holding in Sidian Bank Limited to Access Bank Plc

Centum Investment Company Plc announces binding agreement to sell its 83.4% equity holding in Sidian Bank Limited to Access Bank Plc
Date:
June 7, 2022
Excerpt:

News Release

CENTUM INVESTMENT COMPANY PLC ANNOUNCES BINDING AGREEMENT TO SELL ITS 83.4% EQUITY HOLDING IN SIDIAN BANK LIMITED TO ACCESS BANK PLC

Nairobi, Kenya, Wednesday 8th June 2022. Centum Investment Company Plc (‘Centum’) announces today that it has entered into a binding agreement with Access Bank Plc (‘Access Bank’) regarding a proposed purchase by Access Bank of Centum’s entire equity stake in Sidian Bank Limited (‘Sidian’). Access Bank is a wholly owned subsidiary of Access Holdings Plc (trading as ‘Access Corporation’). Centum holds 83.4% of the issued shares of Sidian, directly in its own name and indirectly through its wholly owned subsidiary, Bakki Holdco Limited. The transaction is for the total sum of KES4.3 billion (four billion, three hundred million Kenyan Shillings) and is subject to customary adjustments agreed by the parties. It is expected that in due course, Sidian will be merged with Access Bank’s subsidiary in Kenya to create a stronger banking institution positioned to serve the Kenyan market.

The completion of the transaction is subject to receipt of customary regulatory approvals in Nigeria and Kenya.

Sidian is a leading SME and trade finance bank that has grown its Balance Sheet by over 70% from KES 19 billion in December 2012 to KES 43 billion as of March 2022 after Centum’s investment. The robustness and resilience of Sidian’s Balance Sheet has enabled it to deliver high impact services to its clientele. Additionally, Sidian’s profitability has improved since 2019, with a record profit of over KES 486 million generated in 2021 while NPL Ratio improved from 20.6% in 2017 to 11.7% as of March 2022, comparing favourably to Kenya’s current national average of 14%.

Sidian has a strong and experienced management team, who have driven the business to meet ambitious strategic targets whilst actively minimizing risks and winning several awards, the most recent of which include Best Bank in Customer Satisfaction Tier III by Think Business Banking Awards 2021: Best Bank in Digital Banking 1st Runners Up, Best Bank in Internet Banking 2nd Runners Up and Best Bank in Mobile Banking 2nd Runners Up.

Speaking on the proposed transaction, Centum’s CEO, Dr. James Mworia, said, “This transaction stands as one of the largest private equity transactions in East Africa and reflects a strong commitment by Access Bank to the future of the Kenyan economy. It advances Centum’s vision to be Africa’s foremost investment channel and bolsters our track record of attracting foreign investors into Kenya and the region to invest in extraordinary enterprises. The proceeds from the sale will enable Centum to continue investing across strategic sectors in Kenya and the East African region. We are particularly pleased to be exiting Sidian at a price which represents a 59% premium to the book value and confirms the deep discount embedded in the valuation of the assets in our book.”

Commenting on the transaction, the CEO of Access Bank, Mr. Roosevelt Ogbonna said, “The transaction builds on our earlier acquisition of former Transnational Bank Plc (now Access Bank Kenya) and underscores our drive to strengthen our presence in Kenya which is a key African market that fits into our core strategic focus for geographic earnings, growth and diversification. Through this transaction and the subsequent merger with Access Bank Kenya, we will be well placed to promote regional trade finance and other cross border banking services, by leveraging our presence in key global trade corridors and the broader East African Community and COMESA regions. The proposed combination with Access Bank Kenya would undoubtedly catapult us to a strong Tier 2 bank contender in the Kenyan market with enhanced capacity to play a more impactful role in the growth of the Kenyan economy and deliver increased profitability to our shareholders.”

Notes to Editors:

About Centum Investment Company PLC

Centum is a publicly listed company on the Nairobi Securities Exchange and cross-listed on the Uganda Securities Exchange. The company has over 36,000 shareholders and its vision is to be Africa’s foremost investment channel. As part of its strategy, Centum is contributing socially and economically to the prosperity of the East Africa region by investing in key sectors of the economy including real estate, financial services, education, FMCG, health care, agriculture and power. As of 31 March 2022, Centum had total assets of approximately US $400 million.

About Access Bank PLC

Access Bank, a wholly owned subsidiary of Access Holdings Plc , is a leading full-service commercial bank operating through a network of more than 700 branches and service outlets, spanning 3 continents, 17 countries and serving 45 million customers. The bank employs 28,000 people in its operations in Nigeria and has subsidiaries in sub-Saharan Africa and the United Kingdom, a branch in Dubai, UAE and representative offices in China, Lebanon, and India. Access Bank’s parent company, Access Corporation is listed on the Nigerian Exchange Limited since 1998 and has over 900,000 shareholders. As of 31 March 2022, Access Bank had total assets of circa US $28.8 billion.

Media Enquiries:

Centum Investment Company PLC: investorelations@centum.co.ke / +254 709 902 000

Access Bank PLC: Investor.relations@accessbankplc.com / +234-1-236 4365