Equity Group Holdings Plc and Atlas Mara (ATMA) agree to discontinue acquisition discussions.

Equity Group Quits Atlas Mara Deal

Nairobi Securities Exchange largest bank by market capitalization Equity Group Holdings Plc and Atlas Mara (ATMA) have mutually agreed to discontinue discussions on the proposed acquisition of Atlas Mara’s banking businesses by Equity Group in Rwanda, Tanzania, Zambia and Mozambique.

The latest move is consistent with the Board’s view of the existing uncertainty of risk, according to a statement of the board’s decision.

“The Board has considered the events that have taken place since January when the two parties agreed to extend transaction discussions and particularly the impact of the COVID-19 pandemic to the world and the economies in which EGH operates. After careful consideration, EGH and ATMA have mutually agreed to discontinue discussions on the transaction for the foreseeable future,” Equity Group’s Managing Director and CEO Dr. James Mwangi said.  

The two firms had in January reached a compromise to extend the period of negotiations following the expiry of the transaction period before the two parties could sign a detailed transaction agreement. That still bore no positive fruit until the current withdrawal.

Equity Group’s Business Continuity Management 

Equity Group now focuses on the following areas to manage its continuity in business with the prevailing and foreseeable circumstances:

1. Conserving cash and liquidity

2. Deploying cash and liquidity to support our customers to survive during this economic crisis and to recover and thrive post the crisis.

3. Accelerating the push to digital channels

4. Growing the various non-funded income franchises while re-evaluating the acquisition of new businesses “where significant capital injection and managerial attention is required”

Read Also: How to Tighten Your Financial Plan to Navigate the Covid 19 Crisis

“A strong capital and liquidity position gives us the strength and capacity to cushion our business, accommodate and walk with our customers during these challenging times. We have deployed a defensive and offensive mechanism through loan accommodations and rescheduling/restructuring of up to 25% of the total loan book for periods of up to 36 months. This will enable our customers to go through the prevailing turbulence, while at the same time preserving cash to shore up the financial revival and growth of their businesses post the COVID-19 crisis,” Dr James Mwangi.

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