NCBA Group announced Wednesday that it has received a strategic investment proposal and a Notice of Intention from South Africa’s Nedbank Group Limited to acquire approximately 66 per cent of NCBA’s ordinary shares through a tender offer, a move that would see the Kenyan lender become a subsidiary of Nedbank.
If completed, the transaction will leave the remaining 34 per cent of NCBA shares listed on the Nairobi Securities Exchange (NSE), preserving the bank’s public ownership profile while transferring controlling interest to Nedbank.
The proposed acquisition values NCBA at 1.4 times its book value.
Shareholders who participate in the tender offer will receive 20 per cent of the consideration in cash, with the remaining 80 per cent settled through the issuance of Nedbank ordinary shares listed on the Johannesburg Stock Exchange (JSE).
NCBA operates across Kenya, Uganda, Tanzania, Rwanda, Ivory Coast and Ghana, with a network of 122 branches serving more than 60 million customers.
The Group holds assets worth Sh665 billion, disburses over Sh1 trillion in digital loans annually, and has delivered an average return on equity of about 19 per cent since the 2021 financial year.
Nedbank, one of Africa’s largest financial institutions, is headquartered in South Africa and has a primary listing on the JSE and a secondary listing on the Namibia Securities Exchange.
Its international footprint includes operations in London, Dubai, the Isle of Man and Jersey.
Currently, Nedbank maintains only a representative office in East Africa.
The transaction aligns with Nedbank’s strategy to expand beyond Southern Africa into high-growth markets, with East Africa identified as a priority region.
Kenya’s position as a regional financial hub, supported by advanced capital markets and a strong technology ecosystem, is expected to serve as the anchor for this expansion.
Under the proposed structure, NCBA will remain listed on the NSE and retain its brand, governance framework, management team and locally anchored decision-making.
Nedbank has indicated there will be no immediate need for system or operational integration within East Africa.
The two institutions expect to generate significant synergies, particularly in corporate and investment banking. Nedbank’s global reach and sector expertise are expected to strengthen NCBA’s capabilities, while NCBA’s digital banking strength, asset finance leadership and regional network will underpin Nedbank’s East African ambitions.
NCBA Group Managing Director John Gachora described Nedbank as a “natural partner” for the bank’s next phase of growth, citing Nedbank’s strong balance sheet, market leadership in South Africa, and top-tier environmental, social and governance (ESG) ratings.
He added that the partnership would support expansion in existing markets and open up opportunities in frontier markets such as Ethiopia and the Democratic Republic of Congo (DRC).
Nedbank Chief Executive Jason Quinn said East Africa offers compelling long-term growth prospects due to its stable macroeconomic environment, young and urbanising population, and vibrant business ecosystem.
He noted that Kenya would serve as the gateway to the wider region, including Rwanda, Tanzania and Uganda.
Together, Nedbank and NCBA are targeting a regional market with a combined population of about 190 million people and a gross domestic product approaching USD 300 billion.
Ethiopia, with an estimated population of 136 million and GDP of USD 135 billion, and the DRC, with 110 million people and GDP of around USD 70 billion, are also viewed as key longer-term opportunities.
The proposed transaction is subject to regulatory approvals, including from central banks in the relevant jurisdictions, and is expected to be completed within six to nine months.
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