Minority shareholders of pan- African lender, African Banking Corporation (ABC) have up until today (Friday) to have accepted a mandatory offer to have them bought out by Atlas Mara. This is according to document that BG Business obtained this Wednesday.
The conclusion of the offer at 12 pm today, paves way for the ABC to delist from Botswana Stock Exchange (BSE). “To be honest our continued listing will depend on authorities. Still, by continuing trad- ing at BSE following the completion of the deal, we will be in violation of trading rules which state that our exposure to the market should be at least 30 percent,” Douglas Munatsi, the group Chief Executive told this publication in September.
Atlas Mara is the investment company owned by former Barclays plc Chief Executive Bob Diamond. Two months ago, the London–based boutique bought ma- jority shares at ABC, in its first African purchase. The deal to acquire 95,84 percent of banking group ABC costs as much as $265 million, Bloomberg has reported. Following the marathon takeover of ABC, Atlas Mara has since offered minority shareholders P7, 49 to part with their shares.
By press time, BG Business could not establishment the total number of ABC minority shareholders. However, as one analyst put it, the minority shareholders have limited options as Atlas Mara, which is quoted at London Stock Exchange is the single and controlling majority shareholder. ABC minority shareholders at Zimbabwe Stock Exchange (ZSE) have not been spared. They have been given $0,82 by Atlas Mara to pave way. Mi- nority shareholders’ acceptance comes with benefits, it seems. “If an ABC Holdings minority shareholder would, following the acceptance of the Offer and exercise of the option to receive At- las Mara shares, receive a fraction of an Atlas Mara share, that shareholder will instead of receiving a fraction of a share be paid the cash equivalent of that frac- tion based on the share price of Atlas Mara of US$12,00 per Atlas Mara,” said the document which has been sent to BSE and ZSE respectively. By the end of next week, ABC will have published the results of the Offer reflecting the Atlas Mara offer. Subsequently, such shares will be listed at LSE, upon delisting at BSE and ZSE.
The delisting of ABC at the domestic bourse will end a 14-year stay at Africa’s third largest exchange by market capitalization. Previously, leading analyst, Garry Juma of Motswedi Securities said any delisting from BSE would also be a drawback. The local bourse is struggling to attract new company listing. BSE recently listed a platinum tracking ETF, but it finished last year without any listing. However, Juma said though it remains an impor- tant player, ABC stock is not one of the most liquid.
By Wednesday afternoon, ABC shares traded at 714 thebe, six thebe shy of the historic 12 months high of 720 thebe to date. ABC is a regional financial services company with opera- tions in Zimbabwe, Zambia, Botswana, Mozambique and Tanzania. Major business units are in Treasury, wealth management/investment banking, corporate finance and advisory, gen- eral finance and custodial services.
This is according to BSE website. On other matters, critics have questioned Diamond’s credibility to run any bank. He left Barclays’ plum post in 2012 after an inter-bank rate rigging scandal that attracted a fine from regulators. “I don’t think Bob is discredited as some say,” said Juma, adding that by pass- ing strict LSE listing rules to put his company into the public, he has proved a point. In fact, by going continental, Diamond’s company is taking the heat to Barclays, his former employers who also ply their trade in Africa, said an analyst. ABC was listed at ZSE in 2000, just before Zimbabwe was hit by politi- cal and economic crises, almost single handedly orchestrated by President Robert Gabriel Mugabe.