KCB shareholders back DRCs Trade Merchant Bank acquisition

The shareholders of KCB Group have approved the bank’s proposed acquisition of DRC-based Trust Merchant Bank (TMB).

The approval by the shareholders hands KCB one-half of the requisite consents required for the completion of the transaction which will see the lender mark its entry into the DRC market.

The transaction is expected to close before the end of 2022 subject to regulatory approvals and other customary closing conditions.

“The approval of the transaction demonstrates the confidence our shareholders have in the financial and strategic benefits of the transaction and the value it provides our regional clients and communities,” KCB Group CEO Paul Russo said.

The transaction for the DRC bank aligns with the Group’s strategic focus on scaling its regional presence.

The deal is expected to lift the Group’s asset base to Ksh.1.5 trillion strengthening the Group’s retail and corporate banking franchises.

Trade Merchant Bank is one of the largest banks in the DRC with an asset base of Ksh.180.8 billion ($1.5 billion).

The bank has a strong retail and SME footprint and has 109 branches and agency banking outlets spread across the DRC.

Earlier this month, KCB indicated it had entered a binding agreement to acquire an 85 per cent stake in TMB for a cash consideration based on the net asset value of the bank at the end of the transaction.

Existing shareholders are expected to continue holding the balance of shares (15%) for a period of under two years after which KCB will pursue the compulsory acquisition of their shares.

The close of the deal will see KCB become Kenya’s second bank with presence in the DRC after Equity Group.