Access Bank acquires Cavmont Bank Ltd in Zambia
Access Nigeria Bank Plc has acquired Cavmont Bank Ltd. Zambia as it seeks deeper foothold in the Southern African country.
The bank announced this via a statement by its Company Secretary Sunday Ekwochi in a notification to the Nigerian Stock Exchange on Thursday.
The deal is a highly complementary transaction that is expected to combine Access Bank Zambia's wholesale and trade finance capabilities with Cavmont Bank's retail and commercial banking operations, the Nigerian tier-1 bank said.
The proposed transaction which, is still subject to relevant shareholder and regulatory approvals, is expected to better position Access Bank Zambia as one of the top 10 banks in the Southern African country, according Ekwochi's statement.
The bank believes that customers from the enlarged bank will benefit from greater security offered by what will be one of the most capitalized banks in Zambia with a more diversified product and service offering and a broader geographical footprint and infrastructure.
The statement reads in part, ''Subsequent to our announcement on July 8, 2020, the Board of Access Bank Plc announces today that its subsidiary, Access Bank (Zambia) Limited, has entered into a definitive agreement with Cavmont Capital Holdings Zambia Plc (CCHZ) regarding proposed acquisition of Cavmont Bank Limited, a subsidiary of CCHZ and subsequent merger of Cavmont Bank's operations into Access Bank Zambia.
“The proposed transaction, which remains subject to relevant shareholder and regulatory approvals, will position the enlarged Access Bank Zambia as one of the top 10 banks in Zambia and create the momentum to advance its strategic objectives.'''
“Under the terms of the agreement, Access Bank Zambia will acquire the entire issued ordinary share capital, assets and liabilities of Cavmont Bank while Capricom Group Limited, the ultimate majority shareholder of CCHZ will invest at least ZMW300 million ($16.5 million) of preference shares into Access Bank Zambia. Capricorn will hold preference shares in the enlarged Access Bank Zambia for a period of five years, after which the preference shares will be acquired by Access Bank Plc.''
The statement also notes that the enlarged bank will be well placed to participate in the long-term economic growth of Zambia and will be predicated on the country's vast reserves of natural resources and fast growing young population.