Ecobank extends $2.5b IPO till Oct 31

At that time, EABS was valued at Ksh1.57 billion ($22.4 million), so an acquisition of a 75 per cent stake meant the deal could be worth more than Ksh1.1 billion ($15.7 million).

The bank’s regional director for East Africa, Albert Essien, said a foothold in Uganda will come in the fourth quarter of this year.

Ecobank’s move to consolidate its presence in the East African market is expected to intensify competition in the financial services market, where recent acquisition deals have added muscle to previously small players.

On the extension of the IPO, Ecobank Rwanda’s country managing director Daniel Sackey said, “Even though receipts from the country were below expectation, it has been a success in Rwanda in terms of creating awareness.”

The Rwandan subsidiary is still collecting investors’ application forms from its branches all over the country.

While investors are still not sure of the full impact of the global financial crisis, management in Kigali believes that this will adversely affect receipts from the Ecobank share offering.

Mr Sackey was quoted in the local press as saying, “The world is now a global village and information is rapidly transmitted to all markets. Sentiments are very high and people have different reactions to information.”

The East African region is also set to benefit from a recent deal worth $213 million between Ecobank Group and the International Finance Co-operation that will see the latter finance its expansion plans and increase financing to small and medium enterprises.

Of the total amount, $100 million will be made available via a convertible loan to support the bank’s regional expansion.

With over 500 branch operations spread around Africa, the convertible loan will also help fund opening of more branches in East Africa.

“Our vision is to become the largest bank in Africa and our entry into the region is part of that strategy,” said Michael Monari, Ecobank’s Kenya country representative.

“We have been looking for a partner who can give us a strong footprint in Kenya — East Africa’s financial hub — and we think that EABS Bank fits the bill,” he said.

Ecobank Transnational, the parent company of the largest independent regional banking group in Africa, was incorporated in 1985.