South Africa's Nedbank Group has announced a landmark offer to acquire a majority 66% stake in Kenya's NCBA Group for approximately R13.9 billion, marking a significant expansion of its African footprint. The proposed deal, structured as 20% cash and 80% new Nedbank shares, would see NCBA become a subsidiary while its remaining shares continue to trade on the Nairobi Securities Exchange.
Nedbank Group CEO Jason Quinn stated the acquisition aligns with the bank's strategy to grow its presence in East Africa, a region he highlighted for its strong macroeconomic fundamentals and role as a key trade corridor. "By combining NCBA’s substantial local presence and Nedbank’s capital base, expertise and enduring commitment to Africa, we see a compelling platform for sustainable growth in the region," Quinn said.
NCBA, formed from a 2019 merger, operates across five African nations with over 60 million customers, a strong digital lending platform, and approximately R84 billion in assets. The bank had previously been rumoured as a potential acquisition target for Standard Bank in late 2025.
Nedbank emphasised that NCBA would retain its brand, local leadership, and NSE listing post-acquisition, with no operational integration required as Nedbank currently only maintains a representative office in the region. The transaction is subject to regulatory approvals and is expected to conclude by the third quarter of 2026.
Market sentiment is likely positive, viewing this as a strategically sound and sizable growth investment by Nedbank. Acquiring a well-established, profitable digital-first bank like NCBA provides immediate scale and a robust platform in the high-growth East African market, reducing Nedbank's reliance on the mature South African market. The share-based payment structure is also viewed favourably as it conserves cash. However, investors will scrutinise the price paid relative to NCBA's book value and the execution risks of managing a cross-border subsidiary. The move could pressure other South African banks, like Standard Bank and FirstRand, to accelerate their own African expansion strategies. Success hinges on Nedbank's ability to realise synergies without disrupting NCBA's strong local operations, with the market likely rewarding the stock if the deal is seen as an addition to earnings over the medium term.
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