Access Bank Zambia has signed a deal that will see it merge with Cavmont Bank, the latest in a series of merger and acquisitions deals involving the Nigerian banking group over the past two years.
The combined bank, which will be a majority-owned subsidiary of Access Bank plc, is expected to become a top ten lender in Zambia.
Joana Bannerman, managing director of Access Bank Zambia, said: “The merger will increase our scale and improve our operating leverage by enabling us to deliver our existing retail and wholesale offerings to a wider base of customers in Zambia while positioning the bank for growth in the long-term trajectory for the country.”
Access Bank will be looking to leverage on Cavmont’s strong retail, commercial and small and medium enterprises loan capability, as well as a presence across seven provinces in Zambia, offering its customers a wider branch network, the group said in a statement.
Right partnerships
Herbert Wigwe, group managing director of Access Bank plc, said: “Access Bank is focused on building the scale needed to become a leading bank in its key operating markets through leveraging the right partnerships. This transaction underscores our approach and is another stepping stone towards delivering on our strategic aspirations of becoming the world’s most respected African bank and Africa’s gateway to the world.
“It will strengthen our presence in Zambia while furthering our footprint for growth in the COMESA region, Africa’s largest free trade area.”
He added, “Over the years, we have worked hard to build a sustainable international bank of African origin than can expand the potential businesses, support economic prosperity, facilitate trade and investment and extend the power of banking to millions of people who do not yet have the financial tools to achieve their dreams. This proposed transaction aligns with that strategy.”
The transaction is scheduled to close by the fourth quarter of 2020 and is subject to the meeting of various conditions precedent which includes Cavmont Capital Holdings Zambia shareholder approval, relevant regulatory approvals, and the local and regional competition commission authorities.
Gateway to East Africa
Access Bank Zambia is a subsidiary of one of the largest banking groups in Africa and has a strong track record of post-merger integration.
It has overseen several continental expansion deals that include last month’s completed acquisition of Kenya’s Transnational Bank plc, following an earlier announcement in October 2019.
“The bank’s vision is to be the World’s Most Respected African Bank and our entry into the Kenyan market, a gateway in East Africa, not only brings us closer to that vision but enables our customers to tap into our extensive global network,” the bank said in a corporate disclosure on the Nigerian Stock Exchange.
The bank last year finalised a US$235 million “strategic merger” with Diamond in Nigeria, which saw the latter transfer all its assets, liabilities and undertakings to Access.
The transaction, part of Access Bank’s five-year strategic plan for continental expansion, birthed what is now the largest bank in Africa by customer size and one of Nigeria’s top-tier lenders with a strong capital base.
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