Kingdom Financial Holdings Limited (KFHL) shareholders last week approved the group’s plans to raise $25 million to recapitalise the operations of its key business units and list its shares on stock exchanges in Mauritius, South Africa and on the local bourse.
Shareholders also authorised the group to acquire a controlling stake in Kingdom Bank Africa Limited Botswana, Amara Tech, a switching company based in South Africa and a private equity firm listed on the Stock Exchange of Mauritius.
Speaking at extraordinary general meeting KFHL chairperson, Sibusisiwe Bango, said the injection of funds will strengthen its key business units, in particular Kingdom Bank Limited (KBL), Kingdom Bank Africa Limited, and MicroKing.
“The recapitalisation of the group is meant to meet the minimum regulatory capital levels, particularly of KBL, following the demerger from Meikles Limited. The demerger resulted in $22,5 million being ceded back to Meikles Limited, which left a gap in terms of the minimum regulatory capital levels,” said Bango.
She said currently KFHL’s capital levels as at June 2011 was $21,8 million, with Kingdom Bank alone having $13,8 million with a significant amount of this capital not recognised as regulatory tier one capital.
“Even though we had been given a dispensation to achieve compliance by February 2012, this recapitalisation exercise ensures that we are able to support the funding requirements of our clients and that of our own growth plans,” said Bango.
The capital was being raised through a combination of the following; rights issue, private placement of shares and the issuance of preference shares.
“Based on the recapitalisation and the current strategies underway, Kingdom’s fundamentals are strong, and the capital raising should enable the group to take advantage of existing and new growth opportunities in its key market segments,” she said.
Bango paid tribute to shareholders for their support to recapitalise KFHL’s operations.