South Africa's banking giant, Nedbank, has submitted an offer to acquire 66 percent stake in NCBA Group for an estimated KES110.32 billion (about $855.5 million) as the lender eyes an entry into East Africa. 

According to disclosures, the transaction will be paid 20 percent in cash and the balance through new Nedbank ordinary shares listed on the Johannesburg Stock Exchange.

Nedbank added that the remaining 34 percent shareholding of NCBA would continue to trade publicly on the Nairobi Securities Exchange.

“Nedbank is an ideal partner for our growth in the East Africa region. Nedbank holds around 16 to 17 per cent market share of loans and deposits in South Africa, leads in vehicle and commercial property finance with 36 percent market shares each, and their overall ESG ratings are top 10 per cent amongst global peers," noted John Gachora, NCBA Group Managing Director. 

He added, "Their strong balance sheet will help us scale in our current markets as well as exploring the investment proposition that the DRC and Ethiopia have to offer. We are proud of the brand we have built and look forward to making it central to Nedbank’s East Africa expansion.” 

If completed, NCBA Group would turn into a subsidiary of Nedbank, though it would retain its brand, local leadership and separate listing, the South African banking giant stated.

Nedbank Group CEO Jason Quinn lauded the acquisition, stating that it was a big step in Nedbank’s push to grow its footprint across Africa.

“By combining NCBA’s substantial local presence and Nedbank’s capital base, expertise and enduring commitment to Africa, we see a compelling platform for sustainable growth in the region,” Quinn said.

“The sale represents a reset of Nedbank’s strategy on the rest of the African continent with a clear focus on the SADC and East Africa regions in businesses Nedbank owns and controls, and areas where we can play to our strengths.”

He added, “Kenya’s role as a regional financial hub, supported by strong institutions, sophisticated markets and a dynamic technology sector, makes it a natural anchor for Nedbank’s East African ambitions, including Rwanda, Tanzania and Uganda. The region’s stable operating environment, consistent macroeconomic performance, a young, growing urbanizing population, and vibrant business community further reinforce its attractiveness and growth potential.” 

Formed in 2019 through the merger of NIC Group and Commercial Bank of Africa Ltd, NCBA currently serves over 60 million customers across 122 branches.

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