KCB Group plans to fully integrate National Bank of Kenya into KCB within the next 24 months after finalising the take-over of the lender on Friday following approval by the Capital Markets Authority (CMA).
During the integration period, KCB will work towards streamlining human resources, systems, processes and procedures to fully realise the value of the envisioned combined efficiencies and productivity synergies post the acquisition.
In an announcement by CMA published on Friday, KCB confirmed that it had received consent to acquire NBK from shareholders holding 297,130,033 issued ordinary shares out of 338,781,200 issued ordinary shares, representing 87.7% by the offer closure date on August 30, 2019.
KCB Group Chief Executive Officer and Managing Director, Joshua Oigara said after receiving all requisite approvals, KCB has named an integration team comprising of staff from KCB and NBK to commence integration activities from today September 6, 2019.
“We will take a number of integration decisions including rationalisation of our branch network in order to enhance service delivery to our customers. Additionally, we will examine the overall human resource needs to enable efficient business organisation,” said Oigara.
On Tuesday, KCB appointed Regional Business Director Paul Russo as the MD designate for NBK during the two year transitional period as the lender becomes integrated with KCB. However, NBK Managing Director Wilfred Musau protested the move.
However, Oigara announced that KCB is now proceeding to complete the transaction as all conditions of the offer have been satisfied.
Trading of shares at NSE
The CEO said NBK Board will be reorganised, adding that from next week, NBK shareholders who swapped their shares for those of KCB will be able to freely trade the new stocks at the Nairobi Securities Exchange.
Oigara said noted that on completion of conversion and swap processes, KCB will hold 1,432,130,033 ordinary shares comprising 97.17 percent of the total issued share capital of NBK and further apply the provisions of the Capital Markets (Take-overs and Mergers) Regulations, 2002 and Part XXIV, Division 4 of the Companies Act to compulsorily acquire the remaining 41,651,167 issued ordinary shares of NBK. Requisite notices in this regard will be sent to all concerned shareholders.
“We are thankful and excited for the goodwill and support we have received from the shareholders, our regulators and all the other stakeholders. This is a good start as we get into full transition,” said Mr. Oigara.
He said the acquisition of NBK will enable the KCB Group drive the financial inclusion and economic empowerment agenda in the East African region while simultaneously building a robust and financially sustainable organisation.