Centum Investment Company exited Sidian Bank after 25 years of ownership with cumulative proceeds from the sale of its stake falling Sh301 million short of the investment firm’s original cost of Sh4.77 billion.
The firm sold its final 14.63 percent stake in Sidian in March and has now disclosed that this deal was valued at Sh1.2 billion, bringing the total proceeds from a series of disposals since 2024 to Sh4.469 billion.
This means that, measured against the historical cost of the investment, Centum recovered about 93.7 percent of the money it originally put into the lender, before taking into account any dividends it may have received during the period.
The investment firm received limited dividends from Sidian over the years, with the bank having to retain capital to support its operations and undertake several rights issues to strengthen its balance sheet.
Sidian was also among the few Centum investments whose historical cost was higher than its market value. The bank was hit hard by lending rate control and the Covid-19 pandemic but its profitability has surged after Centum's exit.
The exit comes after several changes in Sidian’s ownership structure and capital base, including rights issues aimed at strengthening the lender.
The proceeds from the final Sidian disposal helped Centum declare a special dividend of Sh0.36 per share, totalling Sh240 million, in addition to an ordinary dividend of Sh0.42 per share worth Sh281 million.
Centum has in recent years accelerated the disposal of mature investments to unlock capital for new opportunities. Other strategic exits include Nabo Capital, Almasi Beverages and Nairobi Bottlers, while the firm has increased its exposure to real estate through subsidiary Centum Re.
The firm first invested in Sidian in 2001, when the lender was operating as K-Rep Bank. In November 2014, Centum acquired 66 percent shareholding in the bank, lifting its stake to 67.54 percent. This was followed by other transactions that took its stake to 83.43 percent.
The firm initially signed an agreement with Access Bank but the deal fell through, with the investment firm resorting to piecemeal selling of shares to multiple investors.
Buyers of Centum shares, which were mostly held through an investment vehicle called Bakki Holdco Limited, include Pioneer General Insurance Limited, Wizpro Enterprises Limited and Afram Limited.
The ownership structure of the bank has changed on multiple occasions over the past two years due to the exit of Centum and several rights issues aimed at strengthening the lender’s capital base.
The Sh1.2 billion transaction saw Centum sell its 14.63 percent stake in Bakki to an undisclosed buyer. The latest shareholding structure of Bakki as per the Business Registration Services is yet to reflect this transaction. It still lists Centum as one of the shareholders in Bakki, alongside Kenbe Investments.
Bakki holds 27.27 percent stake in Sidian, followed by Wizpro Enterprises Limited (24.95 percent), Afram Limited (24.36 percent), Pioneer General Insurance (16.89 percent), Telesec Africa Limited (3.47 percent) and Pioneer Life Investments (3.06 percent).
Centum’s other strategic exits in the recent past include Nabo Capital, Almasi Beverages and Nairobi Bottlers, increasing exposure in real estate through its subsidiary, Centum Re.
The firm is entering a new leadership phase following the exit of James Mworia, who had served as the CEO for nearly 18 years. Mr Mworia departed this week and took up the role of founding CEO of National Infrastructure Fund (NIF).
Centum board credited Mr Mworia for growing the firm’s assets from Sh4 billion in December 2008, when the company was operating on a Sh200 million overdraft, to an asset base of about Sh46 billion currently.
