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Potential merger NIC + CBA
Superprime1
#61 Posted : Thursday, January 31, 2019 11:03:54 AM
Rank: Member


Joined: 5/2/2018
Posts: 182
sparkly wrote:
Superprime1 wrote:
Ericsson wrote:
sparkly wrote:
[quote=Superprime1]NIC Group will be the holding company of the merged businesses. Merger to be consummated through share swap, business and asset transfer, and share acquisitions in relation to various constituent group companies of NIC Group and CBA Group.

CBA will technically reverse-list.

CBA shareholders will own 53% of the issued shares in NIC Group, which will remain listed.


Link?


https://twitter.com/hashtag/Merger2019?src=hash[/quote]
Looks a good deal by and large, so far.


Excellent deal. Not far from my prediction of CBA:NIC 60%:40% share swap.

The merged entity is likely to be priced at no less than a conservative 45/=, looking at the Q3 numbers...
Ericsson
#62 Posted : Thursday, January 31, 2019 11:09:01 AM
Rank: Elder


Joined: 12/4/2009
Posts: 6,388
Location: NAIROBI
Superprime1 wrote:
sparkly wrote:
Superprime1 wrote:
Ericsson wrote:
sparkly wrote:
[quote=Superprime1]NIC Group will be the holding company of the merged businesses. Merger to be consummated through share swap, business and asset transfer, and share acquisitions in relation to various constituent group companies of NIC Group and CBA Group.

CBA will technically reverse-list.

CBA shareholders will own 53% of the issued shares in NIC Group, which will remain listed.


Link?


https://twitter.com/hashtag/Merger2019?src=hash[/quote]
Looks a good deal by and large, so far.


Excellent deal. Not far from my prediction of CBA:NIC 60%:40% share swap.

The merged entity is likely to be priced at no less than a conservative 45/=, looking at the Q3 numbers...


Depends on what will we the new issued shares of the combined business entity and you might be right going by the below calculation;

NIC total issued shares= 639,945,603.00
This is equivalent to 47% of the combined entity.
53% the new shares to be created=721,640,486
Total Issued shares will therefore be 1,361,586,390
tom_boy
#63 Posted : Thursday, January 31, 2019 11:21:30 AM
Rank: Member


Joined: 2/20/2007
Posts: 668
Mmmmh, interesting. CBA is reverse listing. What is their exposure to mobile lending and how healthy is that asset class looking like. I wonder if they will publish the data on this.
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
Ericsson
#64 Posted : Thursday, January 31, 2019 11:58:58 AM
Rank: Elder


Joined: 12/4/2009
Posts: 6,388
Location: NAIROBI
tom_boy wrote:
Mmmmh, interesting. CBA is reverse listing. What is their exposure to mobile lending and how healthy is that asset class looking like. I wonder if they will publish the data on this.


Add JBBL (Jamii Bora Bank Limited)which they have also swallowed.
Ericsson
#65 Posted : Thursday, January 31, 2019 12:31:00 PM
Rank: Elder


Joined: 12/4/2009
Posts: 6,388
Location: NAIROBI
https://kenyanwallstreet...mpletion-of-the-merger/

NIC Group Plc has set a relative pricing of Ksh53.7 per share in anticipation for the NIC-CBA merger that is expected to commence its operations in Q3 2019.

This is a premium price to the current average trading of Ksh29 at the bourse. The merger announcement on 31 January saw NIC’s share climb by 24.74 per cent to trade at Ksh36.30 by mid-morning compared to Ksh29.10 it was valued at the close of trading hours on 30 January.

NIC will create additional shares to accommodate CBA’s shareholders, once it obtains necessary regulatory approvals.

John Gachora, NIC’s Group Managing Director, says the merged entity shall continue to trade under NIC Group Plc at the bourse, unless the board of directors feels otherwise.
mlennyma
#66 Posted : Thursday, January 31, 2019 12:43:03 PM
Rank: Elder


Joined: 7/21/2010
Posts: 5,922
Location: nairobi
Ericsson wrote:
https://kenyanwallstreet.com/nic-cba-shares-to-trade-at-ksh53-7-upon-completion-of-the-merger/

NIC Group Plc has set a relative pricing of Ksh53.7 per share in anticipation for the NIC-CBA merger that is expected to commence its operations in Q3 2019.

This is a premium price to the current average trading of Ksh29 at the bourse. The merger announcement on 31 January saw NIC’s share climb by 24.74 per cent to trade at Ksh36.30 by mid-morning compared to Ksh29.10 it was valued at the close of trading hours on 30 January.

NIC will create additional shares to accommodate CBA’s shareholders, once it obtains necessary regulatory approvals.

John Gachora, NIC’s Group Managing Director, says the merged entity shall continue to trade under NIC Group Plc at the bourse, unless the board of directors feels otherwise.


our time to eat truly it's darkest before dawn this thing had fallen to 20
"Don't let the fear of losing be greater than the excitement of winning."
VituVingiSana
#67 Posted : Thursday, January 31, 2019 1:20:36 PM
Rank: Chief


Joined: 1/3/2007
Posts: 15,447
Location: Nairobi
mlennyma wrote:
Ericsson wrote:
https://kenyanwallstreet.com/nic-cba-shares-to-trade-at-ksh53-7-upon-completion-of-the-merger/

NIC Group Plc has set a relative pricing of Ksh53.7 per share in anticipation for the NIC-CBA merger that is expected to commence its operations in Q3 2019.

This is a premium price to the current average trading of Ksh29 at the bourse. The merger announcement on 31 January saw NIC’s share climb by 24.74 per cent to trade at Ksh36.30 by mid-morning compared to Ksh29.10 it was valued at the close of trading hours on 30 January.

NIC will create additional shares to accommodate CBA’s shareholders, once it obtains necessary regulatory approvals.

John Gachora, NIC’s Group Managing Director, says the merged entity shall continue to trade under NIC Group Plc at the bourse, unless the board of directors feels otherwise.


our time to eat truly it's darkest before dawn this thing had fallen to 20

Where are those jamaas who were making fun of my investment in NIC? Laughing out loudly Laughing out loudly Laughing out loudly
I am solidly in the black now. Applause Applause Applause
The 53/- sounds even better but does that include NPLs on NIC's books?
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
Swenani
#68 Posted : Thursday, January 31, 2019 4:05:18 PM
Rank: User


Joined: 8/15/2013
Posts: 12,966
Location: Vacuum
Quote:
Dear CBA Customer,

I am pleased to inform you that the Boards of Directors of Commercial Bank of Africa Limited (“CBA”) and NIC Group PLC (“NIC”) have announced that they will recommend the proposed merger of the two banks to their respective shareholders.

The merger will create a universal bank that provides the full range of financial products and services to corporate, institutional, SME and personal banking customers, who will benefit from our strong relationship management focus and customer service excellence. As our customer, you remain and continue to be our first priority.

Please click here to read the joint press statement, which provides further information.

Please note that until the merger becomes effective, the two entities will continue to operate independently and as such, there will be no immediate change to your banking relationship.

Kindest Regards.

Isaac Awuondo Group Managing Director


Joint statememt





Poverty is the root of all evil
tom_boy
#69 Posted : Thursday, January 31, 2019 4:24:42 PM
Rank: Member


Joined: 2/20/2007
Posts: 668
Sijui nilie ama nicheke. Avg loan per customer for CBA is sh 2,804 and NIC shs 806,095. Avg deposits is shs 4,660 for CBA and shs 1,016,714 for NIC.

This is doubly sad. Despite the force of mpesa and millions of customers, CBA is no better than plain old sme bank NIC. This shows that the economy is in the hands of the smes. Mobile loans ni kuchapa maji kwa karai.

To grow the economy, funds must go to smes not to mobile loans.
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
jmbada
#70 Posted : Thursday, January 31, 2019 5:08:37 PM
Rank: Member


Joined: 1/1/2011
Posts: 365
tom_boy wrote:
Sijui nilie ama nicheke. Avg loan per customer for CBA is sh 2,804 and NIC shs 806,095. Avg deposits is shs 4,660 for CBA and shs 1,016,714 for NIC.

This is doubly sad. Despite the force of mpesa and millions of customers, CBA is no better than plain old sme bank NIC. This shows that the economy is in the hands of the smes. Mobile loans ni kuchapa maji kwa karai.

To grow the economy, funds must go to smes not to mobile loans.

I am coming over to your way of thinking. Without a breakout of the mobile loan portfolio, one cannot complete a comparative analysis let alone check the health of their various portfolios. But with a micro-product like mshwari, both the customer count and average loan per customer numbers are skewed. However, it is apparent that scaling up via mobile lending has not led to an outsized gain in loan figures at CBA. We cannot draw conclusions on profitability of mobile lending from the above presentation though.
murchr
#71 Posted : Thursday, January 31, 2019 5:31:24 PM
Rank: Elder


Joined: 2/26/2012
Posts: 14,284
Ericsson wrote:
tom_boy wrote:
Mmmmh, interesting. CBA is reverse listing. What is their exposure to mobile lending and how healthy is that asset class looking like. I wonder if they will publish the data on this.


Add JBBL (Jamii Bora Bank Limited)which they have also swallowed.


Jamii is not part of this merger.

"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
.
Angelica _ann
#72 Posted : Thursday, January 31, 2019 5:37:37 PM
Rank: Elder


Joined: 12/7/2012
Posts: 10,263
jmbada wrote:
tom_boy wrote:
Sijui nilie ama nicheke. Avg loan per customer for CBA is sh 2,804 and NIC shs 806,095. Avg deposits is shs 4,660 for CBA and shs 1,016,714 for NIC.

This is doubly sad. Despite the force of mpesa and millions of customers, CBA is no better than plain old sme bank NIC. This shows that the economy is in the hands of the smes. Mobile loans ni kuchapa maji kwa karai.

To grow the economy, funds must go to smes not to mobile loans.

I am coming over to your way of thinking. Without a breakout of the mobile loan portfolio, one cannot complete a comparative analysis let alone check the health of their various portfolios. But with a micro-product like mshwari, both the customer count and average loan per customer numbers are skewed. However, it is apparent that scaling up via mobile lending has not led to an outsized gain in loan figures at CBA. We cannot draw conclusions on profitability of mobile lending from the above presentation though.


For CBA, because of mobile phone account customer numbers will definitely skew the loan per customer, that is an obvious fact.
In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
Ericsson
#73 Posted : Thursday, January 31, 2019 8:33:04 PM
Rank: Elder


Joined: 12/4/2009
Posts: 6,388
Location: NAIROBI
Value of the transaction is $648mn.
The deal values NIC at $0.43 a 48% premium of its current share price and a 10% discount on its book value
cyruskulei
#74 Posted : Friday, February 01, 2019 10:53:43 AM
Rank: Member


Joined: 3/9/2010
Posts: 124
Location: kenya
Angelica _ann wrote:
jmbada wrote:
tom_boy wrote:
Sijui nilie ama nicheke. Avg loan per customer for CBA is sh 2,804 and NIC shs 806,095. Avg deposits is shs 4,660 for CBA and shs 1,016,714 for NIC.

This is doubly sad. Despite the force of mpesa and millions of customers, CBA is no better than plain old sme bank NIC. This shows that the economy is in the hands of the smes. Mobile loans ni kuchapa maji kwa karai.

To grow the economy, funds must go to smes not to mobile loans.

I am coming over to your way of thinking. Without a breakout of the mobile loan portfolio, one cannot complete a comparative analysis let alone check the health of their various portfolios. But with a micro-product like mshwari, both the customer count and average loan per customer numbers are skewed. However, it is apparent that scaling up via mobile lending has not led to an outsized gain in loan figures at CBA. We cannot draw conclusions on profitability of mobile lending from the above presentation though.


For CBA, because of mobile phone account customer numbers will definitely skew the loan per customer, that is an obvious fact.


Though there is alot of excitement on this merger, the 2017 numbers for CBA are not consistent and exciting.
Make money when others are lamenting
cyruskulei
#75 Posted : Friday, February 01, 2019 11:17:23 AM
Rank: Member


Joined: 3/9/2010
Posts: 124
Location: kenya
cyruskulei wrote:
Angelica _ann wrote:
jmbada wrote:
tom_boy wrote:
Sijui nilie ama nicheke. Avg loan per customer for CBA is sh 2,804 and NIC shs 806,095. Avg deposits is shs 4,660 for CBA and shs 1,016,714 for NIC.

This is doubly sad. Despite the force of mpesa and millions of customers, CBA is no better than plain old sme bank NIC. This shows that the economy is in the hands of the smes. Mobile loans ni kuchapa maji kwa karai.

To grow the economy, funds must go to smes not to mobile loans.

I am coming over to your way of thinking. Without a breakout of the mobile loan portfolio, one cannot complete a comparative analysis let alone check the health of their various portfolios. But with a micro-product like mshwari, both the customer count and average loan per customer numbers are skewed. However, it is apparent that scaling up via mobile lending has not led to an outsized gain in loan figures at CBA. We cannot draw conclusions on profitability of mobile lending from the above presentation though.


For CBA, because of mobile phone account customer numbers will definitely skew the loan per customer, that is an obvious fact.


Though there is alot of excitement on this merger, the 2017 numbers for CBA are not consistent and exciting.


All the FY here

https://cbagroup.com/financials/
Make money when others are lamenting
Ericsson
#76 Posted : Saturday, February 02, 2019 9:56:40 PM
Rank: Elder


Joined: 12/4/2009
Posts: 6,388
Location: NAIROBI
NIC ksh.5bn bond issued in September 2014 matures this year;
Link;https://www.nic-bank.com/ke/nic-bank-upsizes-bond-issue-to-ksh-5-billion-bond-oversubscribed/

NIC Bank Upsizes Bond Issue to Ksh 5 billion; Bond Oversubscribed

Listed lender NIC Bank bid to grow its corporate client base as well as enhance its branch channels to reach more retail and SME customers is on track following the oversubscription of the bank’s bond issue.

The bond is the first issue under the Ksh 8 billion Medium Term Note Program that was recently approved by the Capital Markets Authority. The bond issue that was launched on August 21, 2014 was upsized to Ksh 5 billion from the original Ksh 3 billion.

“In the process of gauging investor interest, it became apparent there was greater demand in the bond issue than the original Ksh 3 billion we were seeking,” said NIC Bank Group Managing Director John Gachora. Gachora added that the additional funds would help to accelerate the banks long term growth plans.

The bond issue targeting institutional and retail investors received offers of Ksh 6.5 billion, representing a 30% oversubscription over the upsized amount of Kshs 5 billion.

Institutional investors offered to take up 90% of the issue, while retail investors accounted for the remaining 10% of the bond issue.

Mr Gachora said the bank was pleased with the outcome of the issue.

“The success of the bond is a vote of confidence on the Bank’s long-term growth strategy. The money raised is critical in strengthening our capital base so as to support growth in our loan book for both the SME and corporate segments,” he said. “This is a major milestone in support of our corporate strategy which calls for robust capital levels and a sustainable funding programme.”

The bank will list the medium-term note at the Nairobi Securities Exchange (NSE).

The bond was available to investors from August 21 to September 3 2014, with a yield of 12.5%.

NIC Capital Limited, a subsidiary of NIC Bank Group, was the lead arranger for the transaction.

According to NIC Capital Managing Director Maurice Opiyo, the bond is an opportunity for investors to diversify their fixed income portfolios at a good return on investment.

“We saw a big appetite for the medium-term note with investors taking advantage of the opportunity. There is an increasing appetite and acceptance of corporate bonds as an alternative source of funding for Kenyan Companies,” said Mr Opiyo.

The bond issue is part of a major capital-raising program initiated by NIC Bank as it seeks to grow its corporate client base as well as to enhance its branch channels to reach more Retail and SME customers across the region.
mlennyma
#77 Posted : Wednesday, February 06, 2019 1:56:50 PM
Rank: Elder


Joined: 7/21/2010
Posts: 5,922
Location: nairobi
I like the volume pushing it upwards
"Don't let the fear of losing be greater than the excitement of winning."
Ericsson
#78 Posted : Tuesday, February 12, 2019 6:19:50 PM
Rank: Elder


Joined: 12/4/2009
Posts: 6,388
Location: NAIROBI
https://www.businessdail...8082-104wo7j/index.html

The merged CBA and NIC bank will count among its top owners some of Kenya’s most renowned billionaire investors and political figures, shareholder information on the two lenders has revealed.

Records from the Registrar of Companies have revealed the underlying ownership of the privately-held CBA bank, whose investors will control a combined 53 percent stake in the merged outfit that is set to start trading on the Nairobi Securities Exchange later this year with a market capitalisation of more than Sh65 billion.

President Uhuru Kenyatta; his brother Muhoho and former First Lady Mama Ngina Kenyatta will together directly hold stakes worth a combined Sh8.5 billion.
The Phillip Ndegwa family, which founded NIC Bank, will own an equivalent of Sh8.6 billion in the combined entity while billionaire businessman Naushad Merali will hold a stake worth about Sh1.9 billion.

The Kenyattas will control about 13.2 percent of the bank, a level of ownership that nearly matches the 13.25 percent equity that the Ndegwa family will also take in the merged entity.

The Kenyattas currently hold a 24.92 percent stake in CBA while the Ndegwas have a 25 percent interest in NIC. Mr Merali will end up with a 2.9 percent equity based on his present direct ownership of a 5.6 percent stake in CBA.

Besides the high-profile billionaires, CBA has other investors whose identity is cloaked in trusts and nominee accounts. Livingstone Registrars, for instance, has a 24.65 percent interest in the private bank that will in turn entitle it to a 13 percent equity worth Sh8.4 billion in the merged entity.

Officials of Livingstone Registrars said they are holding the shares on behalf of local investors whose identity they declined to disclose.
Ropat Nominees and Ropat Trust Company also have a combined 27.88 percent interest in CBA that will translate into a 14.7 percent stake worth Sh9.6 billion in the merged entity.

Ropat’s directors are listed as Mr Robert Kimani Ndung’u and Mr Patrick Kamau Gacheru. Estimates of the effective ownership in the combined bank are based on the latest available shareholder lists of NIC and CBA banks and records from the Registrar of Companies.
CBA, while announcing the merger plans, disclosed that it had a total of 34 shareholders. However, it did not name them. Shareholders of CBA will get the larger stake in the combined business based on the relatively bigger size of the private bank and the value it brings to the table, including a larger asset base and millions of M-Shwari customers.

The merged entity will become the third-largest bank in the country with assets of Sh444.3 billion based on September disclosures. This will see it relegate Co-op Bank with Sh404.1 billion in assets, to fourth place.

KCB Group and Equity Group rank first and second with assets of Sh684.1 billion and Sh560.3 billion respectively.

The merger is currently valued at Sh65 billion – being the book value of the two institutions based on numbers published in the September quarter.

The business combination is expected to be completed by end of September. Areas of overlap including branch networks, technology, management and support functions are expected to be reviewed with a view to cut costs and improve efficiencies.

At the start of the integration, the company will have 2,360 employees and more than 100 branches in multiple markets, including Kenya and Tanzania.

Upon completion of the transaction, the businesses will be organised into banking and non-banking operations. The banking unit will comprise lending and deposit-taking businesses. It will also include a company to house all the digital banking services, including the microcredit platform M-Shwari.

The non-banking division will comprise stock brokerage, property investment, leasing, insurance agency and other ventures.

Besides holding a stake in CBA/NIC, the current shareholders of CBA are also set to own Jamii Bora Bank separately as a private lender after making a Sh1.4 billion cash offer to fully acquire the small bank.

The buyout of Jamii Bora is expected to be completed in the next few weeks.
Beler
#79 Posted : Wednesday, February 27, 2019 9:40:14 AM
Rank: New-farer


Joined: 1/15/2019
Posts: 17
I am just rethinking this bond issuance during 2014. It might be that they have exhausted their lending opportunities and for this reason enter into process of merger, or it was for reason to make portfolios more beautiful before entering into negotiation process? What do you think?
sparkly
#80 Posted : Wednesday, February 27, 2019 9:50:36 AM
Rank: Elder


Joined: 9/23/2009
Posts: 6,786
Location: Enk are Nyirobi
Beler wrote:
I am just rethinking this bond issuance during 2014. It might be that they have exhausted their lending opportunities and for this reason enter into process of merger, or it was for reason to make portfolios more beautiful before entering into negotiation process? What do you think?


Motivations of the Merger IMO:
1. CBA shareholders want to list, hence the merger with listed NIC;
2. New capitalisation requirements for banks. Other small and medium sized banks are also bulking up.
3. Ndegwas looking to divest some of their investments in banking. Remember NIC Group acquired ICEA, Lion Insurance, Solid Stock Brokers.
4. Good fit between the two banks
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