I&M cost of buying Uganda bank rises to Sh4.1 billion
I&M Group has spent Sh4.1 billion to acquire a 90 percent stake in Uganda’s Orient Bank Limited, with the cost rising from the initial estimate of Sh3.6 billion.

The Nairobi Securities Exchange-listed lender says this is after the base price was adjusted to take into account multiple factors.

These include appreciation of the Ugandan shilling against the US dollar, integration support, the short-term financial performance of the subsidiary and the sale of its property.

I&M also agreed to meet the cost of post-completion integration support and to factor in Orient Bank’s net loss or net profit for the period from January 1 until completion.

Sale of the subsidiary’s property in Kampala, Orient Plaza, also weighs in on the transaction price.

I&M made a net profit of Sh284.4 million in Uganda in the half year ended June, up from Sh1.4 million the year before, reflecting the impact of the Orient Bank acquisition.

I&M said the deal has given it access to additional loans worth Sh7.7 billion, deposits (Sh18.2 billion), 70,000 customers, 14 branches and 22 ATMs.

https://www.businessdail...to-sh4-1-billion-3534724

I&M cost of buying Uganda bank rises to Sh4.1 billion
I&M Group has spent Sh4.1 billion to acquire a 90 percent stake in Uganda’s Orient Bank Limited, with the cost rising from the initial estimate of Sh3.6 billion.

The Nairobi Securities Exchange-listed lender says this is after the base price was adjusted to take into account multiple factors.

These include appreciation of the Ugandan shilling against the US dollar, integration support, the short-term financial performance of the subsidiary and the sale of its property.

I&M also agreed to meet the cost of post-completion integration support and to factor in Orient Bank’s net loss or net profit for the period from January 1 until completion.

Sale of the subsidiary’s property in Kampala, Orient Plaza, also weighs in on the transaction price.

I&M made a net profit of Sh284.4 million in Uganda in the half year ended June, up from Sh1.4 million the year before, reflecting the impact of the Orient Bank acquisition.

I&M said the deal has given it access to additional loans worth Sh7.7 billion, deposits (Sh18.2 billion), 70,000 customers, 14 branches and 22 ATMs.

https://www.businessdail...o-sh4-1-billion-3534724[/quote]

Are those figures by business daily accurate? if they are is the deal worth 4billion plus?

That's not an easy question to answer!

I&M is paying 1.1x BV which is a much higher premium than many KE banks are trading at including I&M (0.6x BV)
The 4.1bn that I&M is paying = approx 3.7bn of equity.

Yes, the loans and deposits seem rather low but perhaps that's where I&M can help Orient i.e. new products, new systems, new customers, etc that can profitably boost the topline. It also seems Orient was cutting back on loans, making provisions and cleaning up their books, before the takeover, so the 7.7bn in loans may be clean.

I&M has introduced WhatsApp banking, and a blockchain product, in Rwanda. I think - requires confirmation - that mobile loans will be introduced in Rwanda and Tanzania. Once these are tried and tested then Uganda could a potential market.

I&M's existing clients with businesses in RW, TZ and KE may look to use Orient in UG.
Orient's existing clients may choose I&M in RW, TZ and KE.

RW has been profitable for I&M. Mauritius is up and down. TZ is performing poorly. Where will UG end up?

Kenya's I&M Holdings says it's looking for acquisitions in Ethiopia,Zambia and Democratic Republic of Congo.
Says it will use internally generated cash to fund the potential acquisitions.
I&M says it rarely distributes more than 30% in dividends and is in a strong capital position.

Excuse for peanut dividends

I saw this coming! The current share price of I&M Holdings Plc (IMH) is KES 16.10. IMH closed its last trading day (Thursday, May 25, 2023) at 16.10 KES per share on the Nairobi Securities Exchange (NSE), recording a 3.6% drop from its previous closing price of 16.70 KES. I&M began the year with a share price of 17.00 KES but has since lost 5.29% off that price valuation, ranking it 32nd on the NSE in terms of year-to-date performance.

KES 49 to KES 16 is 1.3%? The thing is that some stocks are sold overpriced and investors keep getting trapped at the NSE. As I wrote here on wazua years back, only about 15 listed firms are worth purchase.. Wazua helps others learn!

And those firm include HF and KQ????