NIC Group’s shareholders have approved its merger with the Commercial Bank of Africa.
“I’m delighted that our shareholders share our vision and have overwhelmingly supported this important merger that will create a leading Tier 1 bank,” NIC’s Chairman James Ndegwa said in a statement.
“The approval allows NIC and CBA to merge their operations and amalgamate the shareholding through which the shareholders of CBA will become 53 per cent shareholders of NIC,” He added.
“The endorsement paves the way for completion of the merger that will deliver significant benefits to the group stakeholders. It is expected that the process will be concluded in the third quarter of 2019.”
CBA in a statement said that during its Annual General Meeting of the shareholders of CBA, they “Further approved and ratified the Merger Agreement and other key transaction documents between the merging entities.”
The documents include the Business and Asset Transfer Agreement, Share Acquisition Agreements, Amalgamation Agreements, Ancillary documents and applications for various regulatory approvals and exemptions.
The deal is subject to approval from regulators and NIC expects the process to be concluded in the third quarter of 2019.
In January, NIC and CBA respective Board of Directors agreed to the merger. The proposed merger will be executed through a share swap. An exchange share ratio will be based on a 47:53 relative valuation of NIC and CBA respectively.
The merger will create one of the largest financial institutions in East Africa with a total asset base in excess of KSh 444 billion and shareholder’s equity of Ksh 65 billion. In Kenya, it would be the second largest bank by customer deposits and third largest by total assets.