I&M acquires Giro commercial bank at estimated USD 500 million
Consequently, effective February 13, 2017, GCBL has ceased to be a bank licensed by CBK, and its rights and obligations have been taken up by I&M Bank.
“This acquisition follows CBK’s approval on October 27, 2016, for IMHL to acquire 100 percent shareholding of GCBL under Section 13 (4) of the Banking Act, and approval by the Cabinet Secretary National Treasury on January 27, 2017, for I&M Bank to acquire 100 percent of GCBL under Section 9 of the Banking Act,” the CBK in a statement said.
Consequently, effective February 13, 2017, GCBL has ceased to be a bank licensed by CBK, and its rights and obligations have been taken up by I&M Bank.
NSE-listed I&M Bank entered the Kenyan market in 1996 and is currently ranked 9 out of 43 banks in Kenya. As at June 31, 2016 it had 4.1 per cent market share with 35 branches.
GCBL was licensed in 1992, and was ranked 26th in terms of market share as at December 31, 2016, a 0.49 per cent market share with 9500 customers most of whom are small and medium sized businesses served through seven branches.
Taken together, they had a combined market share of about 5 percent as at December 31, 2016.
IMHL has a banking presence in Kenya, Mauritius, Rwanda, and Tanzania, and is listed at the Nairobi Securities Exchange.
I&M Bank is a wholly owned banking subsidiary of I&M Holdings Ltd. (IMHL) a non-operating holding company, authorized by CBK under Section 13(4) of the Banking Act.
The move underscores I&M’s expansion strategy through acquisitions, having entered into Tanzania, Rwanda and Mauritius by wholly taking over a local bank or buying a majority stake.
News of acquisition started circulating mid last year after IMF called its shareholders to an extra-ordinary general meeting to approve a deal and creation of the new shares that would see the bank acquire Giro Commercial Bank in a cash and share sell valued at USD 500 million.
As per the deal I&M were to pay USD 250 million in cash and offer owners of Giro Bank a minority stake in a USD 250 million share sell deal.
IMF created 21,043,330 new shares valued at Sh121.05 each, to be used in the transaction.
The move comes on the backdrop of over 12 Kenyan banks given the green light yesterday to launch their own mobile money platform called PesaLink.
I & M Bank is one of the banks that will allow their customers to transfer up to about USD10,000 in a single transaction.
The revolutionary peer-to-peer (P2P) product is offered by Integrated Payment Services Limited (IPSL), a fully-owned subsidiary of Kenya Bankers Association (KBA) formed to implement the platform upon which this and other digital innovations will run.
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