The year 2022 recorded significant deals across the corporate sector despite inflation fears and Russia –Ukraine war disruptions.
Captains of industry had expectations of scaling down operations in the year according to the Central Bank of Kenya (CBK) Chief Executive Officers (CEOs) Survey amid the heightened political activity in the year and in the shadow of the Covid-19 pandemic.
But the year showed optimism and resilience with expansion moves and several mergers and acquisitions that cut across key sectors including financial services, real estate and insurance.
Some of the key ones are the following:
Insurer Jubilee buys Coca-Cola office at Sh1.1 billion
Jubilee Holdings in April bought Coca-Cola East Africa’s former head office in Nairobi’s Upper Hill at a cost of Sh1.1 billion, with the insurer planning to move its headquarters to the property.
The Nairobi Securities Exchange-listed firm said it would lease out part of its address –Jubilee Insurance House on Wabera Street— which will also continue to house its agents and customer service operations.
Besides the head office, other operating divisions that would migrate to the Upper Hill property include its fund management, life, and health businesses.
The property, which sits on 3.2 acres, had been on the market for more than two years. Coca-Cola announced the sale of the property in July 2019 after moving to a new building in Lavington.
The transaction expanded Jubilee’s investment in the real estate market. Through PDM Holdings Limited, the insurance group has interests in Nairobi’s IPS Building, Nation Centre, and Courtyard among others.
Jubilee Allianz General Insurance and Allianz Kenya consolidated into Jubilee Allianz General Insurance
Global general insurer Allianz SE in June acquired the majority stake in Jubilee General Insurance (property and casualty insurance) owned by Jubilee Holdings Limited and renamed it Jubilee Allianz General Insurance, an entity with annual premiums of Sh3.9 billion.
The acquisition was part of transactions in five markets, including Uganda, Tanzania, Mauritius and Burundi that will see Jubilee Holdings receive a total of Sh7.75 billion for the sale of majority stakes ranging from 51 per cent to 66 per cent in its general insurance subsidiaries to Allianz.
The consolidation was aimed at helping the unified firm to benefit from economies of scale.
Jubilee Holdings, however, retained ownership of its life and pensions operations and its medical insurance business in Kenya, Uganda and Tanzania.
Jubilee Health Insurance later acquired the medical insurance business of Allianz Kenya, being the second transaction between the two insurers in the year.
The move saw Allianz Kenya cede its medical insurance business in Kenya.
Centum sells Sidian Bank for Sh4.3bn to Nigerian lender
Centum Investments is in the process of completing the sale of a majority stake of 83.4 per cent stake in Sidian Bank to Nigeria’s top lender, Access Bank, for Sh4.3 billion
Access Bank entered the Kenyan market two years after the buyout of Transnational Bank.
Access Bank acquired a 99.98 per cent stake in Transnational Bank in 2020 from the close associates of former President Daniel Moi in a deal valued at Sh1.56 billion.
Access, which has $25.5 billion in assets, focuses on corporate retail banking and it is expected to boost the growth of Sidian, which will be merged with Transnational Bank which was renamed Access Kenya.
The merger of Sidian and Access Bank’s subsidiary in Kenya is expected to create a stronger banking institution for Nigeria's bank positioned to serve the Kenyan market.
Property developer Acorn sells USIU-A hostel for Sh1.7 billion
Property developer Acorn sold a student hostel built near the United States International University-Africa (USIU-Africa) to an income-focused real estate fund, receiving Sh1.78 billion.
The Qwetu Aberdare Heights hostel, previously held by Acorn Student Accommodation D-Reit, was transferred to Acorn Student Accommodation I-Reit in October.
The hostel has a 697-bed capacity. Its occupancy stood at 75 per cent at the end of June, recovering from 22 per cent a year earlier, according to the property developer.
The rental fee for the rooms ranges from Sh9,900 to Sh14,500 per month, depending on the amenities and space.
Part of the proceeds was used to repay debt worth Sh800.2 million.
KCB completes acquisition of DRC lender for Sh15 billion
KCB Group completed the acquisition of DRC lender, Trust Merchant Bank (TMB), for a value estimated at more than Sh15 billion, being the latest deal in Kenya’s banking sector.
The acquisition of an 85 per cent stake in TMB in the deal first made public last August gives Kenya's tier-one lender a foothold in the vast mineral-endowed central African country.
KCB — already with operations in Rwanda, Burundi, Tanzania, Uganda, and South Sudan— has the right to buy out the remaining shareholders in the 109-branch DRC lender in two years.
The publicly-traded bank sees DRC, which joined the East African Community trading bloc last July, is likely to become the group’s second most profitable country after Kenya in the near term.