Access Bank values NBK at around $100 million as it continues East Africa expansion

On Wednesday afternoon, Access Bank confirmed it had agreed to acquire the National Bank of Kenya (NBK) after unconfirmed reports had teased the transaction for weeks. One of the big questions about the transaction—which is still subject to approval from Nigerian and Kenyan regulators—is how much Access Bank will pay for the acquisition. 

Access Bank will acquire the National Bank of Kenya (NBK) from KCB Group for 1.25x of the bank’s book, the company shared on Wednesday. Given NBK’s book value of $79.77 million in 2023, the deal values NBK at around $100 million.  

However, one financial expert shared that the final acquisition figure could still be markedly different from that estimate. The transaction is expected to take six to nine months to complete, per Paul Russo, the Group CEO of KCB Group. 

In 2020, Access Bank paid $12.8 million to acquire Transnational Bank. In 2022, it agreed to buy 83% of Sidian Bank, a Kenyan commercial bank, for $37 million, implying a price-to-book multiple of 1.1x.

“All parties will be working together in the coming months to fulfill the conditions precedent relating to the proposed acquisition, which includes the regulatory approvals of the Central Bank of Nigeria and the Central Bank of Kenya,” the two lenders said in a joint statement.

Access Bank, which already has 22 branches in Kenya, will increase its footprint in East Africa’s largest economy, given NBK’s nationwide network. However, the Nigerian lender is expected to inject more capital into NBK.

Since KCB Group acquired NBK in 2019, it began to push the ailing bank to profitability and spent $63.5 million to ensure it met minimum capital requirements.

“During the period, we have made progressive investments in the Bank, and we believe that this is in the best interest of the Group and its sustainability. Our growth strategy is premised on both organic and inorganic plans, and we shall continue to seek opportunities that increase our shareholder’s value,” Russo said.

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