Kenyan banking group KCB has announced its intention to acquire, next year, a 24% stake held by minority investors in its Rwandan subsidiary Banque Populaire du Rwanda Plc (BPR).
The Kenyan multinational bank recently completed the acquisition of a 62% stake from London-based Atlas Mara Limited, and another 14% from private equity firm Arise, bringing its stake in BPR to 76%. A full buyout of BPR would cost KCB around 6.4 billion shillings ($ 57 million), if minority investors are offered the same terms as Atlas Mara, which received 3.7 billion shillings ($ 33 million) in exchange for its shares.
Besides acquisitions in Rwanda and Tanzania, KCB is also interested in acquiring a bank in the Democratic Republic of Congo (DRC) where foreign exchange transactions are a major source of income for banks.
The group says the acquisitions reflect the strategy of expanding its operations into the regional market. Like other large banks such as Equity and I&M which have strengthened their presence in this zone in search of growth and diversification.
According to official statistics, international subsidiaries contributed 10.8% of KCB’s net profit of 25.1 billion shillings (224 million USD) in the third quarter of 2021.
Note that the group based in the African Great Lakes region plans to merge BPR and BancABC Tanzania with the subsidiaries it operates in these markets, thereby increasing its size and efficiency.