Market News
How the billionaire Khimji family sold Fidelity Bank for Sh100
Saturday December 30, 2023
The legal battle between Sultan Khimji and SBM Bank has placed the Central Bank of Kenya and its former governor Patrick Njoroge in the eye of the storm. PICTURES | FILE | NATIONAL MEDIA GROUP
On November 16, 2016, tensions arose during negotiations between Fidelity Bank and the Mauritian bank SBM, which was seeking to take over the Kenyan lender.
Previous negotiations had valued Fidelity Bank at Sh1.3 billion, which would have allowed the lender’s owners to pocket a tidy sum in upfront payments while awaiting the takeover of SBM.
Read: Fidelity Bank shareholders rally for cancellation of SBM deal, claim coercion
During initial discussions, the SBM had proposed additional payments after recovery of bad debts, but on November 16, the SBM changed its mind and claimed that Fidelity Bank was worth Sh1 billion.
The Mauritians had proposed injecting 700 million shillings to deal with bad debts and 300 million shillings for legal costs associated with recovery of defaulted loans.
