UGANDA – I&M Holdings Plc. has completed the acquisition of 90 percent shareholding in Uganda’s privately-owned lender Orient Bank Ltd (OBL) as part of its regional expansion plan.
In a press statement, I&M said the acquisition was completed on April 30, 2021 after the transaction received the necessary approvals from the Central Bank of Kenya, Bank of Uganda, Capital Markets Authority of Kenya and the Common Market for Eastern and Southern Africa (COMESA).
The agreement for the deal priced at US$26.93 million was made in July 2020.
“I&M Group aspires to be Eastern Africa’s leading financial partner for growth. The acquisition of OBL will place I&M Bank in an advantageous position to capitalize on the growth in the Eastern African economies and thereby ultimately increasing shareholder value,” said Sarit Raja Shah, I&M’s Group Executive Director.
“This acquisition is expected to give the Group greater capacity to grow profitably, through extending our network to our Regional customers. Further it demonstrates our continued leadership role in the industry across East Africa,” he added.
I&M bank currently has US$3.34 billion worth of assets and a total of 79 branches in Kenya (41 branches), Rwanda (18 branches), Tanzania (8 branches) and Mauritius (12 branches).
“The acquisition of OBL will place I&M Bank in an advantageous position to capitalize on the growth in the Eastern African economies and thereby ultimately increasing shareholder value”
Sarit Raja Shah – Executive Director, I&M Group
However, the acquisition of the Ugandan lender brings with it an additional net loan asset of about US$71.96 million, deposits US$170.09 million, customer base (70,000), a staff component of 340 employees and a network of 14 branches and 22 automated teller machines (ATMs) across Uganda.
In 2016, I&M Holdings Limited acquired 65 per cent shareholding in Burbidge Capital Group, a financial advisory firm. After the acquisition, Burbidge Capital was renamed I&M Burbidge Capital.
Orient bank launched its services in Uganda in 1993. In 1996, Orient bank opened a branch in Jinja, the first outside Kampala.
The bank then acquired Trans-Africa Bank Limited in 2002, which had been declared insolvent by Bank of Uganda.
Through its history, the bank has gone through several ownerships by different entities and individuals. The last acquisition was by the London-headquartered private equity fund 8 Miles, founded by musician Bob Geldof, who acquired a 42 per cent stake in Orient Bank (U) Ltd in 2015.
The founders of the bank, led by Ketan Morjaria, hold 49 per cent in the bank.
The remaining shareholding is by individuals Alemayehu Fisseha, the owner of Prime General Supplies, and the Ugandan-based Chinese manufacturer and property developer, Zhong Shuang Quan – each with 4.5 per cent.
Liked this article? Subscribe to DealStreet Africa News, our regular email newsletter with the latest news, deals and insights from Africa’s business, economy and more. SUBSCRIBE HERE
