Nedbank bids $856m for control of Kenya’s NCBA in East Africa push

Nedbank Group, one of South Africa’s largest banks with over 8 million customers, has offered to buy a controlling stake in Kenya’s National Commercial Bank of Africa (NCBA) Group in a cash and stock transaction valued at $855.5 million, accelerating its push into East Africa.

The offer values NCBA at about 1.4 times book value, according to NCBA. It targets 66% of NCBA, leaving the remainder of the lender publicly listed on the Nairobi Securities Exchange (NSE).

The proposed deal signals a growing interest by South African banks in East Africa’s financial markets, where population growth, regional trade corridors, and expanding digital retail banking promise scale. For Nedbank, the acquisition could provide an established regional footprint.

The structure seeks to keep NCBA on the Nairobi Securities Exchange while preserving its brand and management, and uses a share-heavy payment mix that limits cash outlay while tying the two banks’ fortunes together.

Under the terms of the transaction, shareholders will receive 20% in cash and 80% in newly issued Nedbank ordinary shares listed on the Johannesburg Stock Exchange (JSE), a structure that limits Nedbank’s immediate cash outlay while binding the two banks’ fortunes together.

The pricing is anchored on Nedbank’s share price at the time of the announcement on Wednesday, bringing the total deal value to 13.9 billion rand, or $855.5 million.

If completed, NCBA would become a subsidiary of Nedbank. The remaining 34% of NCBA shares would continue to trade on the NSE, a feature designed to maintain local market discipline and minority investor visibility. 

NCBA has said its governance structure, operations, and leadership team would remain in place.

Formed in 2019 through the merger of NIC Group and Commercial Bank of Africa, NCBA is one of East Africa’s larger financial services groups. It operates 122 branches across Kenya, Uganda, Tanzania and Rwanda, and offers digital banking services in Ghana and Côte d’Ivoire. The bank says it serves more than 60 million customers across these markets.

Jason Quinn, Nedbank’s chief executive, said the combination would pair NCBA’s local presence with Nedbank’s capital base and cross-border banking capabilities.NCBA’s management has framed the deal as a partnership, according to its CEO John Gachora, who says Nedbank is seen as a strategic investor that can support expansion in existing markets and potential entry into countries such as Ethiopia and the Democratic Republic of Congo (DRC).