ACCESS Bank Plc, has announced the end of its plan to acquire a controlling stake in a Kenyan bank.
According to the Bank in a statement, the parties were unable to reach an agreement on some conditions “needed to prudently complete the transaction,”
A corporate disclosure signed by Company Secretary Sunday Ekwochi said Access Bank remains committed to growing its franchise safely and soundly in Kenya.
“The bank remains, however, committed to growing its franchise in a safe and sound manner in Kenya and the broader East Africa community and will continue to explore a variety of organic and inorganic opportunities to grow.”
Apparently, the completion of the proposed transaction was subject to fulfilment or waiver of certain conditions before the long stop date as defined in the transaction agreement.
But as the company explained, some of these conditions were not met because both parties were unable to reach an agreement on the set conditions.
Their failure to reach an agreement was despite the best effort of Kenyan regulators who provided support through engagements throughout the transaction negotiations.
“Consequently, we hereby notify the Nigerian Exchange Ltd and the investing public that the Sidian acquisition will no longer be completed by the bank,” the statement said.
It will be recalled that Access Bank Plc has entered into an agreement to acquire the entire 83.4 percent equity stake held by Centum Investment Plc, a Kenyan-based investment company, in Sidian Bank Ltd, for the sum of about N15 billion ($37 million).
Access Bank disclosed the acquisition in a statement sent to the Nigerian Exchange Limited, NGX, noting that the transaction is subject to regulatory approvals in Kenya and Nigeria.
Access Bank said the purchase consideration includes the price to “book multiple of 1.1 times” based on the audited March 31, 2022 shareholders’ equity of Sidian.
Commenting on the transaction, Herbert Wigwe, the group chief executive, Access Corporation said: “This growth transaction being implemented in Kenya represents the relentless focus and execution of our strategic objectives within our banking subsidiary even as we grow the other businesses within Access Corporation’s core segments.”
“The acquisition of Sidian is a significant step-up in scale and potential for Access Bank in Kenya which represents the largest market and trade corridor in East Africa.
“The significant increase in scale and customer base presents us with enormous opportunities to support growth in the various ecosystems we are building in our trade and payment business.”
On his part, Roosevelt Ogbonna, chief executive officer, Access Bank, said the transaction builds on their earlier acquisition of the former Transnational Bank Plc (now Access Bank Kenya) “and underscores our resolve to strengthen our presence in Kenya, a key African market that fits into our strategic focus for geographic earnings growth and diversification.”
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