Nigerian Lender, Access Bank Acquires Sidian bank From Centum for Sh4.3 bn

Centum Investment Company Plc has agreed to sell its entire equity stake in Sidian Bank Limited (‘Sidian’) to Access Bank Plc for KES4.3 billion.

Centum owns 83.4 percent of Sidian’s issued shares, both directly and indirectly through Bakki Holdco Limited, its wholly-owned subsidiary.

Sidian is planned to be merged with Access Bank’s Kenyan unit in the near future, resulting in a stronger financial entity better positioned to service the Kenyan market. The transaction’s conclusion is contingent on the acquisition of customary regulatory approvals in Nigeria and Kenya.

Sidian is a leading SME and trade finance bank that has increased its balance sheet by more than 70% since Centum’s investment, from KES 19 billion in December 2012 to KES 43 billion in March 2022. Sidian’s Balance Sheet’s sturdiness and resilience have allowed it to provide high-impact services to its clients.

Furthermore, Sidian’s profitability has improved since 2019, with a record profit of over 486 million generated in 2021, and the NPL Ratio has improved from 20.6 percent in 2017 to 11.7 percent as of March 2022, compared favorably to Kenya’s current national average of 14 percent, thanks to a strong and experienced management team, who have driven the business to meet ambitious strategic targets while actively minimizing risks and winning several awards, the most recent of which was the Kenyan Business Excellence Award.

“This deal stands as one of the largest private equity transactions in East Africa and demonstrates a significant commitment by Access Bank to the future of the Kenyan economy,” Centum’s CEO, Dr James Mworia, said of the planned acquisition. It bolsters Centum’s track record of attracting foreign investors to Kenya and the region to invest in remarkable firms, and it supports Centum’s aim of becoming Africa’s leading investment channel. Centum will be able to continue investing in Kenya and the East African area with the proceeds from the transaction.

We are particularly pleased to be exiting Sidian at a price which represents a 59 per cent 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
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, and 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.”