Orient Bank has broken its silence on the sale of its 90% stake to Kenya’s I&M Holdings PLC.
In a statement titled: Update statement on the proposed acquisition of Orient Bank Limited by I&M Holdings PLC, published in local media, the bank states:
“On 17th July 2020, the shareholders of Orient Bank limited (the Bank) entered into an agreement with I&M Holdings PLC for the sale of 90% of the issued share capital of the bank. The transaction is subject to conditions including regulatory approvals from the Bank of Uganda, Central Bank of Kenya, and Capital Markets Authority of Kenya,” the statement reads in part.
Ketan Morjaria remains minority shareholder
The statement adds: “Upon completion of the transaction, the remaining 10% shareholding shall be held by Dr. Ketan Morjaria (a founding member of Orient Bank) and Mr. Alemayehu Fisseha. Subject to receipt of regulatory approval, Dr. Ketan Morjaria shall continue to be a member of the Board of Directors of the Bank.”
“The Bank’s Board and Management wish to advise the public that the proposed transaction is entered into, as part of the Bank’s growth strategy aimed at becoming a leading player in Uganda’s banking industry and part of a strong and growing regional banking group,” says Orient bank’s Management.
The bank’s management also assures their clients that it will continue operating as usual during the interim period.
“We wish to reassure all our customers and other stakeholders that the Bank will continue to operate as normal whilst the process of obtaining regulatory approval is ongoing,” read an excerpt from the statement.
Uganda’s Corporate Finance and Capital Markets Luminary, Miriam Ekirapa Musaali, Passes OnAbout Orient Bank
Orient Bank Limited launched its services in Uganda in 1993. In 1996, Orient bank opened a branch in Jinja, the first outside Kampala. The bank then acquired Trans-Africa Bank Limited in 2002, which had been declared insolvent by Bank of Uganda.
Through its history, the bank has gone through several ownerships by different entities and individuals. The last acquisition was by the London-headquartered private equity fund 8 Miles, founded by musician Bob Geldof, who acquired a 42 per cent stake in Orient Bank (U) Ltd in 2015. The founders of the bank, led by Ketan Morjaria, hold 49 per cent in the bank.
The remaining shareholding is by individuals Alemayehu Fisseha, the owner of Prime General Supplies, and the Ugandan-based Chinese manufacturer and property developer, Zhong Shuang Quan – each with 4.5 per cent.
In 2019, the bank struggled to make money, turning in a loss of UGX1 billion Uganda from a UGX5.6 billion profit registered in 2018. Its assets grew to UGX814 billion in 2019 from UGX749 billion in 2018, according to published financial results.
Additional reporting by URN
