Atlas Mara Limited, the sub-Saharan African financial services group, has announced that it has entered into a binding term sheet with Equity Group Holding (ECG) for the exchange of certain banking assets of the Company in four countries for ordinary shares in EGH (the “Proposed Transaction”). The Proposed transaction is subject to confirmatory due diligence and relevant regulatory approvals.
As part of the Proposed Transaction, EGH would acquire Atlas Mara’s 62% shareholding in Banque Populaire du Rwanda (BPR) and, via the Company’s subsidiary ABC Holdings Limited, all of Atlas Mara’s indirect interests in African Banking Corporation Zambia (BancABC Zambia), African Banking Corporation Tanzania (BancABC Tanzania), and African Banking Corporation Mozambique (BancABC Mozambique). The parties would anticipate mergers of their respective banks within each of Rwanda and Tanzania.
Subject to regulatory approval, the individual transactions are expected to close between the fourth quarter of 2019 and the first quarter of 2020, depending on jurisdiction.
Commenting on the Proposed Transaction, James Koni, Managing Director for Atlas Mara Zambia said, “As Atlas Mara Zambia we are very excited about this new partnership for Atlas Mara Zambia. Equity Group Holdings Plc (EGH), which is a large diverse financial services conglomerate has a customer base in excess of 9.2 million in six East & Central African countries, namely Kenya, Rwanda, South Sudan, Democratic Republic of Congo, Uganda and Tanzania, making it one of the largest commercial banks on the African continent by customer numbers.
Equity group is a renowned Bank and has won a number of global accolades. It is ranked by the top 1000 Banker as number 11 globally on return on assets, also ranked number 35 on soundness of capital. The group is rated AA by Moody `s an international rating agency. AA is the second highest investment grade rating after AAA.
Much more importantly Equity Bank is the most innovation Bank and has delivered strong financial inclusion and customer service using technology in East Africa. Our partnership with Equity Group Holdings Plc will give us an opportunity to further consolidate the good work we have done so far for our stakeholders. Equity Group Holdings Plc is a power house for innovation and Digital Banking. This will firmly position Atlas Mara Zambia to bring first class digital banking to Zambia”.
He further stated that this change is at shareholding level and will have no immediate impact on the day to day operations of the Bank .He also confirmed that they will be no loss of employment for Atlas Mare employees. As a matter of fact, we should expect to see further expansion in other financial services such as Insurance and brokerage to provide a holistic financial services.
The new partnership with Equity Group Holdings Plc will also presents a great opportunity for us to adopt best technology and product innovation utilising the expertise from Equity’s unique business model, which offers a tried and tested pathway for growth through innovation.’
However, analysts expect that the top local management teams will have some level of shake up. Like most acquisitions, the top management in the acquired Atlas Mara will face evaluation and there is bound to be some key changes as the new owners may look at taking control and infusing their corporate culture into the acquired operations.
