Equity Bank Suspends Buying Atlas At Ksh 10 Billion

Equity had started negotiations about buying the subsidiaries in April 2019 but the deal took long to materialize on the acquisition of Atlas Mara subsidiaries in Rwanda, Zambia, Tanzania, and Mozambique until Covid-19 came knocking.

Equity Bank has been restructuring its finances in the wake of the pandemic, including calling off the payment of dividends to shareholders that had already been declared. The proposed dividend payout had been set at 2.50 shillings per share, amounting to 9.4 billion shillings.

With the pandemic weighing heavily on its back, Equity is also still in the process of purchasing a 66.5 percent stake in Banque Commerciale Du Congo in DRC where it is expected to raise at least 11.1 billion shillings for the deal to materialize.

The bank also says the pandemic has forced it to restructure loans worth 92 billion shillings. Banks have been forced to restructure loans in an effort to cushion customers against the pandemic and the impact on businesses.

While the Atlas Mara deal was to be paid for through Equity shares equivalent to a 6.72 percent stake valued at about Sh10.6 billion, the loss-making subsidiaries would have needed substantial capital injection from the Kenyan bank.