ATLAS Mara Co-Nvest Limited is eyeing a controlling stake in ABC Holdings in a transaction worth $265 million as the London Stock Exchange-listed firm moves into the Sadc region.
BUSINESS REPORTER
ABC Holdings has banking operations in Zimbabwe, Botswana, Zambia, Mozambique and Tanzania under the BancABC brand.
Atlas Merchant Capital LLC and Mara Group Holdings are led by Bob Diamond, former chief executive of Barclays plc, and Ashish Thakkar, the founder of diversified African investment group Mara.
The transaction involves Atlas Mara buying 50,1% from selected shareholders in cash or swap, buying Africa Development Corporation (ADC)’s 37% stake in the banking group through cash or share swap and buying out minority shareholders representing 12%.
“Atlas Mara has reached conditional purchase agreements with selected shareholders of BancABC to acquire, for cash or shares, BancABC shares representing in excess of 50,1% of total shares outstanding for $0,82 per share or the equivalent in Atlas Mara shares,” Atlas Mara said in a statement.
“Atlas Mara has entered into a Business Combination Agreement with ADC, whereby Atlas Mara has stated its intention to make a public share-for-share takeover offer, directly or through a subsidiary, for all outstanding shares of ADC at an exchange ratio of 1,25 Atlas Mara shares per ADC share.”
BancABC provides financial services to people in Botswana, Mozambique, Tanzania, Zambia and Zimbabwe with roots dating back to 1956. ADC is a Frankfurt-based, open-market listed,Africa-focused, emerging pan-African banking group.
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It has an indirect 47,1%stake in BancABC (including shares representing 9,3% of BancABC held subject to a call option agreement with BancABC management), an indirect 9,1% stake in Union Bank of Nigeria and a portfolio of innovative, financial services-oriented private equity holdings.
The completion of the transaction is conditional upon getting regulatory and related government approvals in Botswana, Mozambique, Tanzania, Zambia and Zimbabwe.
Atlas Mara says the proposed combination with BancABC and ADC is consistent with its strategic objective of building a premier sub-Saharan financial services group.
Upon completion of the transaction, BancABC chief executive officer Douglas Munatsi will join the Atlas Mara group executive committee.
Atlas Mara will provide up to $100 million of equity to BancABC, “to drive its growth going forward, as well as support BancABC’s management in obtaining additional liquidity, including raising Tier II capital”.
ABC Holdings posted a 50% rise in net interest income of 1 billion Botswana pula with all banking operations having recorded an increase in net interest income due to growth of the balance sheet expected for BancABC Tanzania.
ABC had indicated it plans to raise $360 million in various instruments in the following months.
