DTB Group #ticker:DTK has acquired an additional 16.34 per cent stake in its Burundian subsidiary after buying out International Finance Corporation (IFC) for Sh152.2 million.
The transaction, which was completed in the year ended December, raised the Nairobi Securities Exchange-listed firm’s equity in Diamond Trust Bank Burundi to 83.67 per cent from the previous 67.33 per cent.
It marks the latest investment in regional subsidiaries in which the Kenyan banking multinational has been raising its stake by participating in rights issues and buying out minority shareholders.
DTB is among a group of local banks that are expanding their regional footprint in a bid to capture new growth and reduce reliance on the Kenyan market.
“On June 22 2018, Diamond Trust Bank Kenya Limited acquired an additional 16.34 percent stake in Diamond Trust Bank Burundi Limited by purchasing International Finance Corporation’s shareholding in the entity at a consideration of Sh152.2 million,” the lender says in its latest annual report.
“The group increased its shareholding to 83.67 per cent from 67.33 per cent before the purchase. The carrying amount of the net assets the group acquired was Sh166.7 million.”
The transaction leaves DTB and a Burundi-based private company holding a 16.33 per cent stake — as the owners of the subsidiary.
DTB says its regional subsidiaries collectively contributed to 25 per cent of its total assets and 16 per cent of its profitability in the year ended December.
The lender made a net profit of Sh6.6 billion in the review period compared to Sh6.4 billion the year before.