Understanding the Proposed Nedbank–NCBA Deal: A Simple Retail Investor Guide

What Is Happening?

Nedbank Group Limited wants to acquire approximately 66% of issued shares in NCBA Group PLC through a partial offer to shareholders.

This is not a full takeover of NCBA. The bank is expected to continue trading on the Nairobi Securities Exchange (NSE) after the transaction.

Shareholders will decide individually whether to accept the offer or keep their shares.

How the Offer Works

For every 100 NCBA shares accepted, shareholders would receive:

KES 2,100 cash
4.02994 Nedbank shares

However, only about 66% of your total NCBA shares are expected to participate in the offer. The offer is structured as a pro-rata offer targeting approximately 66% of NCBA’s issued shares. Actual accepted shares may vary depending on final allocations and acceptance mechanics.

This means many investors may eventually hold:

Estimated Remaining NCBA Shares (Illustrative)
Cash proceeds
Nedbank shares

at the same time.

Simple Example

Suppose you own 10,000 NCBA shares.

Step 1: Calculate Participating Shares

10,000 × 66% = 6,600

So about 6,600 shares participate in the offer.

Step 2: Cash Portion

(6,600 ÷ 100) × 2,100 = KES 138,600

Estimated cash received: KES 138,600

Step 3: Nedbank Shares Portion

(6,600 ÷ 100) × 4.02994 ≈ 265.98 shares

Estimated Nedbank shares: About 266 shares

Step 4: Remaining NCBA Shares

10,000 − 6,600 = 3,400

Remaining shares: About 3,400 NCBA shares which continue trading.

Meaning after settlement, this investor could end up holding:

KES 138,600 cash
About 266 Nedbank shares
About 3,400 NCBA shares

Small Shareholders May Receive Cash Only

Retail investors with smaller holdings may not receive Nedbank shares directly.

If your allocation is below approximately 200 Nedbank shares, you may qualify for a cash-only settlement instead.

This mainly affects investors with below roughly 7,500 NCBA shares.

Approximate Threshold

7,500 × 66% × 0.0402994 ≈ 199.48

That is why many smaller shareholders may simply receive cash if they decide to offer

Retail Shareholder Calculator

NCBA Shares Owned	Approx Eligible (66%)	Remaining NCBA Shares (34%)	Estimated Cash (KES)	Estimated Nedbank Shares	Likely Outcome
500	330	170	6,930	13.30	Cash likely
1,000	660	340	13,860	26.60	Cash likely
2,000	1,320	680	27,720	53.20	Cash likely
5,000	3,300	1,700	69,300	132.99	Cash likely
7,000	4,620	2,380	97,020	186.18	Cash likely
7,500	4,950	2,550	103,950	199.48	Borderline
8,000	5,280	2,720	110,880	212.78	Cash + Shares
10,000	6,600	3,400	138,600	265.98	Cash + Shares
20,000	13,200	6,800	277,200	531.95	Cash + Shares
50,000	33,000	17,000	693,000	1,329.88	Cash + Shares
100,000	66,000	34,000	1,386,000	2,659.76	Cash + Shares

FINAL LOOK
Table below shows estimated post-transaction outcome based on a 66% qualifying acceptance assumption. Please note the final figure will depend on applications reaching targets, volumes and market conditions. Dont peg so much on the receivables as it can change. Also pro-rata basis may be applied if the required threshold is exceeded.

Assumption used:
• Investors qualifying for below 200 Nedbank shares receive KES 105 per qualifying NCBA share
• Investors qualifying for 200+ Nedbank shares for every 100 shares receive KES 2100 cash+ 4.02994 Nedbank shares

NCBA Shares Owned	Qualifying Shares (66%)	Remaining NCBA Shares	Cash Received (KES)	Nedbank Shares Received
500	330	170	34,650	0
1,000	660	340	69,300	0
2,000	1,320	680	138,600	0
5,000	3,300	1,700	346,500	0
7,000	4,620	2,380	485,100	0
7,500	4,950	2,550	519,750	0
8,000	5,280	2,720	110,880	212.78
10,000	6,600	3,400	138,600	265.98
20,000	13,200	6,800	277,200	531.95
50,000	33,000	17,000	693,000	1,329.88
100,000	66,000	34,000	1,386,000	2,659.76

Simplified Formula

If Qualifying Below 200 Nedbank Shares:

Cash = NCBA Shares × 66% × KES 105

Actual value for investors receiving Nedbank shares changes daily depending on Nedbank market price and exchange rate movement. Also your actual value depends on the details in the link shared with you by registrar.

Important Dates

Offer opens: 28 May 2026
Offer closes: 10 July 2026 — 5:00 PM EAT
Results announcement: By 21 July 2026

Key Risks Investors Should Understand

FX Risk

Nedbank shares are denominated in South African Rand (ZAR).

If the Rand weakens against KES → investment value may decline
If the Rand strengthens against KES → investment value may rise

JSE Market Risk

Investors gain exposure to:

South African economy
JSE market conditions
South African banking sector

Tax Considerations

South Africa generally applies 20% dividend withholding tax
Capital Gains Tax (CGT) may apply when selling shares at profit
FX conversion costs and broker fees may apply

What Happens If You Ignore the Offer?

If you do nothing:

You may simply continue holding NCBA shares
You may not receive cash or Nedbank shares
Your ownership percentage could change depending on final structure

Why This Deal Matters Strategically

Possible reasons Nedbank may want NCBA include:

East African expansion
Regional banking growth
Digital banking opportunities
Cross-border trade financing
African banking integration

Simple Retail Decision Guide

Investor Type	Possible Thinking
Small holder	May prefer cash-only outcome
Income investor	May prefer NCBA dividends
Growth investor	May want Nedbank exposure
Liquidity-focused investor	May sell on NSE instead
Diversification investor	May like offshore exposure
Long-term investor	May hold NCBA + Nedbank together

Final Retail Takeaway

For many investors, this transaction may create a mixed portfolio consisting of:

Remaining NCBA shares
Cash proceeds
Nedbank JSE-listed shares

Participating investors could end up with exposure to both the Kenyan and South African banking sectors at the same time.

The most important thing is to avoid emotional decision-making.

Instead consider:

Valuation
Dividend preference
FX exposure
Long-term goals
Tax implications
Liquidity needs

Disclaimer:

This article is for retail education and discussion purposes only and is not financial, legal, tax, or investment advice.

Investors should read the official offer documents carefully and consult licensed financial, legal, or tax advisors before making investment decisions.