I&M Group PLC has issued an important advisory to its shareholders and investors regarding recent developments.
In a notice dated October 15, 2024, the company’s Board announced the approval of a subscription for new ordinary shares worth up to sh86.5 million by East Africa Growth Holding (EAGH).
According to the announcement, EAGH will acquire up to Ksh86.5 million in new shares at a subscription price of sh48.42 each.
The subscription will represent approximately 4.97% of the company’s expanded total share capital upon completion.
“Pursuant to Regulation 89(2) of the Capital Markets (Public Offers, Listing and Disclosures) Regulations, 2023, I&M Group PLC announces that its Board has approved a subscription agreement with East Africa Growth Holding (EAGH).
EAGH will subscribe for up to eighty-six million five hundred thousand (86,500,000) new ordinary shares at a price of Kenya Shillings Forty Eight and Forty-Two Cents (Sh 48.42) per share,” the notice states.
The company indicated that more detailed information regarding the transaction will be shared with shareholders in the near future.
The Board cautioned that this transaction could significantly impact the trading price and overall value of the company’s shares, urging shareholders and the public to exercise caution when trading in I&M Group shares.
Additionally, I&M Group has informed shareholders that the completion of the subscription is contingent upon fulfilling standard conditions, which include obtaining all necessary regulatory and shareholder approvals.
This announcement follows I&M Group’s recent report indicating a rise in its six-month net profit for the period ending June 2024.
The bank’s net profit increased by 17.4% to sh5.6 billion, driven by higher lending income amid rising interest rates.
Notably, net interest income surged by 35.2% to sh16.5 billion.
The Kenyan unit of I&M significantly contributed to this growth, increasing its net revenue from lending by 37% to sh11.2 billion.
However, operating expenses rose by 14% to sh14.3 billion, largely due to a 20% increase in staff costs, which reached sh4.18 billion.
This uptick in expenses is part of the bank’s ongoing expansion, which included opening eight new branches in January and plans to launch an additional twelve by the end of 2024.
Despite the positive earnings growth, I&M Bank’s non-funded income fell by 11% to sh6.16 billion, primarily due to a 38% drop in foreign exchange trading income, which amounted to sh1.82 billion as the Kenyan shilling strengthened against the dollar.
