The offer by NIC bank to merge with Commercial Bank of Africa has received a high acceptance rate with 29 out of 34 investors in CBA agreeing to the offer as at 11th March 2019. According to a statement issued by the directors of CBA group, these 29 shareholders own 98 percent of the bank.
The two banks began discussions of a possible merger in December 2018. They concluded that in the event of a merger, the 34 owners of CBA will own 53
The union is expected to create Kenya’s third largest bank by assets. It will propel NIC bank from a second tier bank to a first tier bank.
Analysts predict that the banking sector will experience many similar transactions as more banks consolidate. Directors of CBA group noted that certain requirements need to be met before the merger is finalized. The directors warned CBA investors that the merger will have a significant effect on the company’s share and bond prices. As a result, traders in such securities were advised to exercise caution