Centum, which is listed on the Nairobi Securities Exchange, had opted to sell off its entire stake (83.4 percent) in Sidian Bank (formerly K-Rep Bank) after the third-tier lender failed to generate returns for seven years (2014-2021).
“Sidian Bank is a good asset. It is growing but it is not paying dividends and it is not contributing to the cashflows of the company so our strategy has been to improve these kind of assets ,exit them and redeploy the capital to more cash generating assets,” Mworia told The EastAfrican last year.
“The objective is to boost our cash flows. Now there are a lot of opportunities even in the bond market and the stockmarket. You know valuations have come down and so there are a lot of opportunities in the market.”
However, in the past week, Centum management changed tune on the viability of the investment after Access Bank Plc pulled out of the deal saying Sidian is a “great bank with great prospects.”
“We intend to remain investors in Sidian. It is a great bank with great prospects,” Mr Mworia told The EastAfrican.
In a public notice on January 12, Centum said the deal valued at Ksh4.3 billion ($34.95 million) fell through after the parties failed to fulfil the transaction conditions within the timelines prescribed in the Share Purchase Agreement (SPA).
“The completion of the acquisition of shares in Sidian by Access Bank Plc was subject to various conditions being met or waived by the parties by the Long Stop Date, as defined in the Share Purchase Agreement,” said Mworia.
“The Long Stop Date has passed without all the conditions being fulfilled or waived despite the support and guidance of the Central Bank of Kenya.”
According to Mworia, Centum has not been able to reach acceptable terms with Access Bank for a further extension of the SPA and has opted not to pursue extension of the same.
“The Share Purchase Agreement has therefore lapsed, in accordance with its terms and stands terminated,” said Mworia.
“The shareholders of Centum and the investing public are hereby notified that Centum will continue as a shareholder in Sidian following this termination of the Share Purchase Agreement.”
Long Stop Date refers to the latest period by which the respective party to a transaction has to fulfil its obligations.