Access Bank is set to acquire Kenya’s Sidian Bank for $36.7 million (15 billion Naira), reports suggest. The Nigerian commercial bank has reportedly brokered a deal with Centum Investment Plc to procure the 83.4% shares belonging to the investment platform and its subsidiary Bakki Holdco Ltd.
The deal, which is likely to go through, will become Access Bank’s 5th major acquisition outside the shores of Nigeria in the last 18 months, its second in the Kenyan market.
According to Access Bank, the $36.7 million valuation was arrived at using “a price-to-book multiple of 1.1x based on the audited 31 March 2022 shareholders’ equity of Sidian.”
Access Bank already has a subsidiary company in Kenya which is valued at 49.6 billion Naira and will be looking to strengthen its presence in the East African country. CEO of the subsidiary bank, Roosevelt Ogbonna outlines that this deal will mark a huge step in achieving the goal.
“This transaction builds on our 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,” he said.
“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.”
Hebert Wigwe, Chief Executive Officer of Access Holdings, also reiterated the importance of the deal in his statement.
“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,” he said.
“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 system.”
Centum CEO, James Mworia, states that the deal will bring in required monetary value to the company which would be used to invest in other strategic sectors in East Africa.
“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,” said Mworia.
“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.”
Sidian is renowned for its special banking system where it lends funds to small and medium-sized enterprises. The deal will expand Access Bank’s market scale but is subject to regulatory approval in Nigeria and Kenya.