Listed lender I&M Bank has agreed to acquire Giro Commercial Bank in a cash and share sell deal valuing the low tier lender at Sh5 billion.
I&M is asking to pay Sh2.5 billion in cash and offer owners of Giro Bank a minority stake in a Sh2.5 billion share sell deal.
The NSE-listed lender is creating 21,043,330 new shares valued at Sh121.05 each, to be used in the transaction.
The bank has called its shareholders to an extra-ordinary general meeting to approve the deal and creation of the new shares.
“I&M Holdings is required to effect payment of the purchase consideration for Giro Commercial Bank shares by way of cash consideration of Sh2.5 billion and issuance of the additional 21,043,330 shares on completion of the acquisition,” said the bank in a published statement Monday.
Giro, ranked 27 out of 43 banks in Kenya, has a 0.49 per cent market share with 9000 customers served through seven branches.
I&M ranks 10th with a market share of 4.1 per cent.
Giro recorded a net profit of Sh452 million last year, with customer deposits of Sh12.8 billion and a loan book of Sh9.3 billion