The Bidvest Group said yesterday it has entered into an agreement to sell 100% of its Bidvest Bank Holdings to Nigeria head-quartered international banking group, Access Bank, for about R2.8 billion.
The announcement, also of the sale of its FinGlobal business to Momentum Group and consideration of offers for the Bidvest Life company, follows Bidvest’s announcement in July to restructure and sell its financial businesses, even though these were performing well.
Bidvest intends to continue growing in its niche services of hygiene, facilities management, and distribution of plumbing and related products.
“Bidvest will continue to support Bidvest Bank to ensure that it remains financially sound and operationally stable throughout the disposal process,” Mpumi Madisa, CEO of the South African services, trading, and distribution group, said yesterday in a statement.
Access Bank is a full-service commercial bank with over 60 million customers globally, serviced through a network of over 700 branches in 23 countries across three continents.
Through a strong presence in Nigeria, 16 subsidiaries in Africa, the UK, and representative offices in China, Hong Kong, the United Arab Emirates, India, and France, Access Bank employs over 8 400 people.
It services various markets through four business segments: retail, business, commercial, and corporate. As at December 31, 2023, Access Bank's shareholder equity exceeded $1.7bn, with customer loans and deposits of $6bn and $12.5bn, respectively.
Last month, Access Bank completed the acquisition of Standard Chartered Bank Angola S.A and Standard Chartered Bank (Sierra Leone] and is working on the completion of transactions to acquire Standard Chartered Bank’s subsidiaries in Cameroon, the Gambia and its Consumer, Private and Business Banking business in Tanzania.
Access Bank has been operating in South Africa since 2021 following its acquisition of Grobank Limited.
“In South Africa, the strategy has expanded to align with the vision of becoming the gateway to Africa and the world's most respected African bank,” a statement said.
Bidvest said proceeds from the disposal of the bank would be used to settle existing Bidvest debt.
Access Bank intends to introduce broad-based black economic empowerment ownership, including an employee stock ownership plan.
Madisa said they expected the regulatory approvals to take six months to achieve, implying an expected effective date before the end of the current financial year.
In the 2024 financial year, Bidvest Bank generated trading profit and operating income of R371 million and R377m, respectively. The Bidvest Bank book, which consists mainly of leased assets, loans, and advances, totalled R6bn, which is mainly funded by deposits of R8bn.
Cash and investment securities amounted to R5bn, which included restricted cash, from a Bidvest perspective, of R3bn.
FinGlobal’s financial emigration solutions offered to South African expatriates would benefit from the scale and complementary capabilities of Momentum. All employees would be retained as part of the transaction, Bidvest directors said.
Meanwhile, Bidvest was in possession of offers from existing life insurers for 100% of Bidvest Life.
“One of these offers will be advanced to an agreement in the coming weeks,” Madisa said.
Bidvest’s share price notched up 0.93% to R281.70 on the JSE on Thursday morning, a level that was over 21% higher than a year previously.
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