(NAIROBI, KENYA) – Absa Group has failed in its bid to raise its stake in Absa Bank Kenya to as much as 85% through a tender offer worth about $238 million (KES30.8 billion / £187 million).
The South African banking group bought 189.38 million shares from minority shareholders out of the 895.9 million it had offered to purchase, representing a 21.1% subscription rate. Absa, which held around 68.5% of Absa Bank Kenya, offered KES34.50 ($0.27 / £0.21) per share to buy stocks from minority investors.
The transaction was expected to lift its stake by up to 16.5%, but it only managed to increase ownership by 3.49%. Absa Group will now hold 3,910,196,644 ordinary shares, representing about 71.99% of issued ordinary share capital of Absa Kenya.
The share price surged at the Nairobi bourse after the deal announcement, narrowing the premium that Absa had offered in the tender. Absa stock opened trading at KES29.20 ($0.22 / £0.18) at the Nairobi Securities Exchange on 19th June, the day its parent firm announced the tender offer, which closed on 11th August. The share stood at KES33.65 ($0.26 / £0.20) on 11th August.
South African banks have been stepping up acquisitions in East Africa, filling a gap left by retreating European banks and riding a wave of increased continental trade and investments into energy and infrastructure.
Charles Russon, Absa Group executive for Africa regions, said Kenya is a strategically important market for Absa Group and remains central to its East Africa growth ambitions. He said the proposal reflected confidence in the bank’s leadership, strategy and growth prospects, as well as Absa’s commitment to supporting Kenya’s economy.
Absa, South Africa’s third biggest lender by assets, said it intends to maintain Absa Bank Kenya’s listing on the NSE after the transaction. The group added it does not plan to alter the bank’s business strategy, management team, staffing levels or day to day operations.
Absa’s Africa Regions business contributed 31% to group headline earnings in 2025. That same year, Kenya contributed about 19% of the profits in the Africa regions portfolio.
The bank on Tuesday more than doubled its interim dividend to KES0.50 ($0.0039 / £0.0030) per share despite reporting a 9.8% decline in net profit for the half year ended June 2026. The lender reported a net profit of KES10.5 billion ($80.8 million / £63.6 million) in the half year to June, down from KES11.6 billion ($89.2 million / £70.3 million) posted in a similar period last year.
Management attributed the profit drop to a lower interest rate regime, one-off costs and a slump in forex earnings. Absa Group will earn KES1.95 billion ($15 million / £11.8 million) from the interim dividend for its 71.99% stake.