Access Bank Holdings has entered an agreement with Centum Investment Company Plc (‘Centum’) to acquire its 83.4% stake in Sidian Bank Limited, increasing the Nigerian bank’s visibility on the map of African banking industry.
The Nigerian Bank has been spreading its wings over Africa through mergers and acquisitions. It is Access Bank’s fifth major acquisition outside its base Nigeria in 18 months, and its second acquisition in Kenya in recent times. The Pan-African bank acquired Transnational Bank in 2020.
The agreement gives Access Bank a controlling stake estimated at $37 million (N15 billion) in Sidian, and emboldens its stride for further deals in the Kenyan financial industry, where it has asset valuation of N49.6 billion as of the end of last year.
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“The 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,” Herbert Wigwe, the Group Chief Executive, Access Corporation 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 business. The economies of scale that derive therefrom will continue to drive and enhance contributions to all stakeholders,” he added.
Sidian Bank was founded in 1984 as K-Rep Bank. In 2015, Centum Investment Company completed its acquisition of a majority stake in the bank and changed its name to Sidian bank in 2016 to reflect its majority shareholding.
Kenya adds to the growing number of countries in Africa where Access Bank is seeking a strong foothold. In the last three years, the trail-blazing pan African bank has acquired Grobank in South Africa, announced its intention to acquire 100% of Zambia’s Cavmont Capital, through its subsidiary, Access Bank Zambia and in talks with Atlas Mara to buy its assets in Botswana, Zimbabwe and Zambia.
However, Access lost its bid to acquire the majority stake in a fellow Nigerian bank, Union Bank, through a planned acquisition of investment company Atlas Mara’s holding in the entity, to Titan Trust Bank.
The Sidian Bank deal is still subject to regulatory approval but Mr. Roosevelt Ogbonna, Chief Executive Officer of Access Bank said it will consolidate the bank’s position in the East African Community bloc.
“This transaction builds on our earlier acquisition of the former transactional 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. The acquisition and intended subsequent merger will create a strong and competitive balance sheet for Access Bank in Kenya, positioning us to be well placed to promote regional trade finance and other cross border banking services in the East African Community (EAC) and broader COMESA region.
“The proposed combination with Access Bank Kenya would undoubtedly propel Access Bank into a strong contender in the Kenya market with enhanced capacity to play a more impactful role in the growth of its economy while delivering increased profitability for our shareholders,” he said.