Companies

I&M adds 364 staff on Uganda buyout

im

I&M branch on Kenyatta Avenue, Nairobi. FILE PHOTO | NMG

I&M Group #ticker:IMH added 364 employees to its workforce in the year ended December after acquiring a controlling 90 percent stake in Uganda’s Orient Bank Limited.

The lender said in an investor briefing that it closed the period with 2,536 employees, up from 2,172 workers in 2020.

The new subsidiary, now renamed I&M Bank (Uganda) Limited, had 314 staff in the review period when it made the biggest contribution to the growth in employee numbers.

Kenyan banks have recently seen their workforce grow substantially on the back of acquisitions they are making in the regional market where they are taking over established banking institutions.

KCB Group #ticker:KCB also added 1,013 employees to its payroll last year following its acquisition of a controlling 62.06 percent stake in Banque Populaire du Rwanda Plc (BPR).

The transaction, which made BPR a subsidiary of KCB, raised the workforce of the Kenyan banking multinational to 8,538 in the year ended December. KCB’s staff count stood at 7,525 in the previous year.

Equity’s #ticker:EQTY staff count in 2020 jumped by 539 to 7,119 after the lender acquired a controlling 66.53 percent stake in the Banque Commerciale Du Congo (BCDC).

Growth in employment from existing operations has been slow as the lenders intensify their investment in digital banking platforms which have reduced the need for expansion of brick and mortar branches.

I&M says the Uganda acquisition will pay off in the future. The Kampala-based subsidiary made a loss before tax of Sh596 million which was attributed to “resizing and consolidation” costs.

The acquisition gave the Kenyan banking multinational access to an additional 75,000 customers, 14 branches, and 17 ATMs.

I&M Group was running a corporate finance advisory business, I&M Burbidge Capital, in Uganda and the acquisition of the bank has expanded its operations in that market.

The multinational had spent Sh4.1 billion to acquire the 90 percent stake by mid last year, with the cost rising from the initial estimate of Sh3.6 billion.

The Nairobi Securities Exchange #ticker:NSE -listed firm said this was after the base price was adjusted to take into account multiple factors.

They included the appreciation of the Ugandan shilling against the dollar, the short-term financial performance of the subsidiary, and the sale of its property and integration support.

The multinational signed an agreement with the sellers to make price adjustments on account of exchange rates between the date of signing the deal and its completion.

[email protected]