Centum to sell additional 19 percent stake in Sidian Bank
James Mworia (right) CEO of Centum Investments and Risper Alaro, the Group Finance Director, during the company's investor briefing held at its Two Rivers offices in Nairobi on July 30, 2024
Photo credit: Wilfred Nyangaresi| Nation Media Group
Centum Investments is set to sell 18.91 percent of its stake in Sidian Bank in a deal estimated at Sh1.03 billion, cutting its shareholding in the small lender to under a fifth.
The investments firm has invited shareholders to vote on the proposal during the annual general meeting set for September 30. If approved, the transaction will see Centum’s stake in Sidian fall from the current 34.1 percent to 15.19 percent.
“The sale of a portion of the company's shareholding (18.91 percent) in Sidian Bank Limited through its wholly owned subsidiary Bakki Holdco Limited, resulting in Sidian Bank Limited ceasing to be a subsidiary of the company, be ratified,” reads the AGM notice in part without disclosing the buyer.
The sell-down, the fourth in less than 12 months, could fetch Centum about Sh1.03 billion if executed using the Sh5.44 billion carrying value Sidian had at the end of June 2024.
In a series of transactions, Sidian has welcomed five new investors— Pioneer General Insurance Limited, Pioneer Life Investments Limited, Wizpro Enterprises Limited, Afrah Limited and Telesec Africa Limited— cutting Centum’s stake from a peak of 83.43 percent at the end of December 2022.
In the first round of sales in October last year, Centum received about Sh1.98 billion for cutting its stake in Sidian from 83.43 percent to 44.52 percent.
Centum then sold another stake in the last two months of 2023, reducing its ownership to 40.03 percent and earned an estimated Sh228.05 million from the deal.
The latest shareholding structure on the Sidian website shows that Bakki now holds 34.1 percent stake, suggesting that Centum sold 5.93 percent this year, receiving about Sh322.6 million. This is based on Sidian’s book value by the end of June.
If shareholders approve the proposal to sell 18.91 percent stake, Centum would have received Sh3.56 billion in less than 12 months from the four transactions.
In mid-2022, the investment firm wanted to dispose of the entire 83.43 percent stake at once to Nigeria’s Access Bank for Sh4.3 billion —a figure that Centum CEO James Mworia said represented a 59 percent premium to the book value at the time.
Access later pulled out of the deal in mid-January last year, forcing Centum into piecemeal sales. The remaining stake has a carrying value of about Sh825.9 million, meaning Centum could cumulatively fetch slightly higher proceeds from the piecemeal sales.
The latest shareholding structure shows Wizpro has leapfrogged Pioneer General to become the second highest shareholder after its stake rose to 24.32 percent from 18.27 percent it held at the end of 2023. Pioneer General’s stake has dropped to 21.12 percent from 24.8 percent in the same period.
Afram has also bought more shares and now has a 12.29 percent, up from 7.91 percent in December. The stakes of Telesec and Pioneer Life dropped by under one percentage point to 4.34 percent and 3.83 percent respectively.
