KCB Shareholders Approve Acquisition of DRC’s TMB

KCB Group shareholders have approved the acquisition of Democratic Republic of Congo (DRC)-based lender Trust Merchant Bank (TMB)as it moves to consolidate its presence in the market of  90 million people.

The deal was sealed yesterday in Nairobi after several months of engagement, marking KCB’s seventh market outside Kenya. 

The Kenyan lender had in August announced entering into a definitive agreement with the shareholders of TMB to acquire 85 percent of the shares.

Existing shareholders will continue to hold the remaining 15 percent shares for a period of not less than two years after which KCB will have the right to acquire it fully. TMB is one of DRC’s largest banks with $1.5 billion total assets and more than 109 branches across the country.

 “The shareholders’ nod is a major milestone for us to accelerate the acquisition process which will allow us to scale up our balance sheet, revenue streams and contribute positively to KCB’s growth and diversification objectives,” KCB Group Chairman Wambari Kairu said.

With this, he added, KCB will be able to rapidly establish its presence within DRC by leveraging TMB’s 18-year operational history and vast branch network.

The transaction is expected to close before the end of the year, subject to regulatory approvals and other customary closing conditions. The transaction will be made with a cash payment for the shares based on TMB’s net asset value at the date of closing.

 A multiplication factor of 1.49 has also been included in the final agreement signed between the two groups.  With an insurance subsidiary called Affrissur SA, the transaction will provide a good platform for KCB to diversify its offerings in the region.

TMB purchase is part of KCB’s strategy to expand its regional participation, accelerate growth and maintain sustainable long-term regional success while investing in and maximizing the returns from its existing businesses.