Wednesday, January 27, 2021

Botswana retail investors shun BancABC IPO?

By Kabelo Seitshiro

Retail investors might have given a lukewarm response to pan-African banker ÔÇô African Banking Corporation Holdings which seeks to make a return to the Botswana Stock Exchange Limited (BSEL) through the listing of one of its subsidiaries ÔÇô BancABC Botswana.

The multinational banker announced recently its intention to list part (24.9%) of its local unit ÔÇô BancABC Botswana at the local bourse.

Following the approval of the listing by BSEL, BancABC then set a 23 November 2018 as the deadline for the Initial Public Offer (IPO) but has since extended the offer duration by week, now ending on 30 November 2018.

On Monday, BancABC Managing Director ÔÇô Kgotso Bannalotlhe confirmed the extension of the IPO period adding that the extension will allow more retail investors to participate.

“It will allow clients of the participating brokers to also take part”.

Bannalotlhe further said, “Institutional investors have pledged their irrevocable undertakings at the launch of the offer,”

On claims that potential investors are skeptical because of the bank’s 2015 BSEL delisting decision which created uncertainty, Bannalotlhe stated that they have not received any comments from any investor expressing a concern about the previous listing of ABC Holdings.

He emphasised that the previous listed entity was ABC Holdings.

“The current listing is of African Banking Corporation Botswana, a subsidiary of ABC Holdings.  In this offer, the Botswana subsidiary will be listed on the Botswana Stock Exchange Limited.  Hence BancABC Botswana has never been listed as a standalone entity,” said Bannalotlhe.

Bannalotlhe is of the view that the offer has been strongly supported by institutional investors as outlined in the offer documents adding that the offer remains open to allow retail investors an opportunity to participate further in the story of the Bank.

The pull-out of the local stock exchange in early 2015 happened shortly after the group’s former directors Doug Munatsi, Beki Moyo as well as Francis Dzanya sold their shares to the owners of Atlas Mara. Atlas Mara is owned by Bob Diamond, founder of Atlas Merchant Capital LLC and Ashish Thakkar, founder of Mara Group Holdings Limited. The company was listed on the main market of the London Stock Exchange in December, 2013

BSEL on the 01 November 2018 received approval is for the listing of African Banking Corporation Botswana Limited

Currently, BancABC Botswana is ranked as the fourth most profitable bank in the country and 5th in terms of balance sheet. As such, Bannalotlhe at the time said BancABC Botswana’s goal is to bolster its market position and become the bank of choice for individuals, corporates, and public sector entities in Botswana by offering differentiated services through investment in technologically advanced interaction platforms.  He added that the bank and the Bank’s parent Groups ÔÇô ABC Holdings and Atlas Mara have been making, and intends to further make, investments geared towards achieving this goal.

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