Britam Holdings, a listed diversified financial services group, is poised to earn a tidy KSh 13.9 Billion from the sale of its shares in Equity Group to International Finance Corporation(IFC), the private investment arm of the World Bank. IFC will acquire the 253.1 Million shares at a price of KSh 55 each, according to sources familiar with the transaction negotiations.
BRIT closed its on Wednesday, December 29, 2021 at KSh 7.68 per share on the Nairobi Securities Exchange (NSE), recording a 2.7% gain over its previous closing price of KSh 7.48. Britam began the year with a share price of KSh 7.26 and has since gained 5.79% on that price valuation, ranking it 21st on the NSE in terms of year-to-date performance.
The private transaction price represents a premium of 10.88% on the Equity Bank’s closing price of KSh49.6 Tuesday. The share sale markets the final exit of Britam from Equity since 2004 when it begun purchasing these shares. Britam held an 11 percent stake in the bank worth about KSh900 million when Equity listed on the Nairobi Securities Exchange (NSE) in August 2006 via introduction.
The insurer has over the years earned billions in the form of dividend income and partial sale of the bank’s shares as it worked down its concentration risk.
For IFC, the proposed investment marks a tighter relationship with Equity to which it is the single largest creditor.
IFC will now also become Equity’s second-largest shareholder with a 6.7 percent stake.
Britam joins rival Jubilee Holdings which was among the first to cut its exposure to the volatility in the performance of the stock market.