Wednesday, April 8, 2020

IFC eager for ABCH shareholding

Thiery Tanoh, International Finance Corporation director for Sub-Sahara Africa, was upbeat about the prospects of his company taking a stake in ABC Holdings, the parent company of African Banking Corporation (ABC) as part of his organization efforts to invest in Africa.

The World Bank’s investment arm has forked-out $ 1.1 billion (about P 7 billion) targeted towards taking stakes in organizations operating in Africa with a bid of increasing their competitiveness.

“ABC fits in the whole programme and I think the deal will be concluded within the next few weeks,” Tanoh told The Sunday Standard on the side-lines of the just ended World Economic Forum which was held in Cape Town.

The IFC is aiming to invest in the financial sector, mining and telecommunication outfits before the end of this year.

His comment comes after ABC’s well publicized cautionary this month in which investors were urged to attend an emerging general meeting which is to decide on the intentions of the IFC.

The IFC intends to take a 10 percent stake in the whole company and advance it a loan which will be paid over a period of seven years.

According to ABC’s Chief Executive Officer, Douglas Munatsi, the stake would be worth P 39.8 million representing a premium given the company’s current trading price.

“IFC has realized that the company has more value than what the market is currently pricing it at and what they are paying is a premium,” Munatsi said.

The cash realized from the sale of the shares will be used by ABCH for regional expansion as well as for working capital.

He said ABCH is already looking into the prospects of entering AngolaÔÇöwhere they have opened a representative officeÔÇöand the Democratic Republic of Congo (DRC).

“The board and executive management view the IFC subscription as anchoring in a collaborative partnership with the existing and new investors aimed at strengthening and expanding the group’s footprint. And the executive management and the board are supportive of the move,” he added.

“This will provide the bank with preferential treatment with regard to lines of credit, specialized technical skills and training,” Munatsi said.

He further pointed out that the injection of capital will give the bank fire-power to roll-out some new products, such as credit cards, among other things.

ABCH is owned by an assortment of shareholders which include, Debswana Pension Fund, Botswana Insurance Fund Management (Bifm), the Rockefeller Family and other small shareholders.

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