Nigeria’s financial institution, Access Bank plc, continued its determined African footprint expansion with an announcement Thursday that its subsidiary in Zambia, Access Bank Zambia (ABZ) Limited, has entered into a definitive agreement with Cavmont Capital Holdings Zambia (CCHZ) Plc for a merger of the two firms.
In a statement signed by Sunday Ekwochi, the company’s secretary and filed with The Nigerian Stock Exchange, Access Bank said the proposed transaction, which remains subject to relevant shareholders and regulatory approvals, will position the enlarged Zambian subsidiary of the bank as one of the top 10 banks in Zambia, thus creating the momentum to advance its strategic objectives.
Herbert Wigwe, the bank’s group managing director, while commenting on the transaction, 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.
“Over the years, we have worked hard to build a sustainable bank of African origin that can expand the potential of the business, 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 the strategy,” he further said.
Earlier in July, the bank announced the board’s decision to combine Access Bank Zambia’s wholesale and trade finance capabilities with Cavmont Bank’s retail and commercial banking operations. The transaction, however, is expected to be completed by end of the year.
Also commenting on the transaction, Peet van der Walt, managing director of Cavmont Bank, said: “Cavmont’s vision is to be a world-class bank, rated amongst the best in Zambia. This proposed merger with Access Bank Zambia accelerates our strategy and positions us as a top ten bank in the country (Zambia). As a subsidiary of one of the largest banking groups in Africa, Access Bank Zambia has the scale, capabilities and ambition to enable the combined bank to pursue exciting strategic opportunities in Zambia.
“Our customers will benefit from greater security offered by one of the most capitalized banks in the country, increased scale in Zambia, access to a broader digital and retail offering, and a geographic network across the continent. We look forward to working closely with Access Bank to deliver the benefits of the merger to all stakeholders,” he stressed.
Thinus Prinsloo, managing director, Capricorn Group, noted that, “Access Bank is an African banking group with an impressive growth trajectory and geographic reach across Africa and internationally. This transaction is an excellent strategic fit with Cavmont Bank’s presence in Zambia, and will strengthen the capital base from which to achieve long term sustainable growth. Zambia is an economy with significant growth potential that is poised for a robust recovery, and this combination best positions the combined bank to harness these opportunities.”
The terms of the agreement will allow Access Bank Zambia to acquire the entire issued share capital, assets and liabilities of Cavmont Bank, while Capricorn Group Limited, the ultimate majority shareholder of CCHZ, will invest at least $16.5 million (ZMW300 million) of preference shares into ABZ. Capricorn is also expected to hold preference shares in the enlarged ABZ for a period of five years, after which the preference shares will be acquired by Access Bank plc.
Access Bank continuing its pursuit of becoming one of the most respected banks in the world by building its footprints across Africa and internationally. This comes just weeks after the bank completed the transactions on the final acquisition of Kenya’s Transnational Bank as well as its 28 branches, and also the establishment of a subsidiary in Cameroon.