Connect with us

Finance

Access Bank Enters Into Definitive Agreement With Cavmont Capital

Published

on

herbert wigwe

Access Bank Signs Definitive Agreement With Cavmont Bank Ltd

Following July 8, 2020 announcement, the Board of Access Bank Plc on Thursday said its subsidiary, Access Bank Limited (Zambia) has entered into a definitive agreement with Cavmont Capital Holdings Zambia regarding the acquisition of Cavemont Bank Ltd.

In the statement released through the Nigerian Stock Exchange, the bank said the proposed acquisition will position Access Bank as one of the top 10 banks in Zambia and improve the bank’s momentum to advance its strategic objectives.

The bank said “This is a highly complementary transaction, combining ABZ’s wholesale and trade finance capabilities with Cavmonth Bank’s retail and commercial banking operations. Customers of the enlarged bank will benefit from greater security offered by what will be one of the most capitalised banks in Zambia with a more diversified product and service offering and a broader geographical footprint and infrastructure. The enlarged bank will be well-placed to participate in the long-term economic growth of Zambia, predicated on the country’s vast reserves of natural resources and fast-growing young population.

The transaction agreement showed Access Bank Zambia will acquire the entire issued share capital, assets and liabilities of Cavmonth Bank while Capricorn Group Limited, majority shareholder of Cavmonth Capital Holdings, will invest around $16.5 million or ZMW300 million of preference shares into Access Bank Zambia.

According to the bank, the transaction is expected to be completed in the fourth quarter of 2020.

Speaking on the transaction, Herbert Wigwe, the Group Managing Director, Access Bank Plc, said “Access Bank is focused on building the scale needed to become a leading bank in its key operating markets through leveraging the right partnerships. This transaction underscores our approach and is another stepping stone towards delivering on our strategic aspirations of becoming the World’s Most Respected African Bank and Africa’s Gateway to the World. It will strengthen our presence in Zambia, while furthering our footprint for growth in the COMESA region, Africa’s largest free trade area.

“Over the years, we have worked hard to build a sustainable international bank of African origin that can expand the potential of businesses, support economic prosperity, facilitate trade and investment and extend the power of banking to millions of people who do not yet have the financial tools to achieve their dreams. This proposed transaction aligns with that strategy”.

Thinus Prinsloo, Managing Director of Capricorn Group, also said: “Access Bank is an African banking group with an impressive growth trajectory and geographic reach across Africa and internationally. This transaction is an excellent strategic fit with Cavmont Bank’s presence in Zambia and will strengthen the capital base from which to achieve long-term sustainable growth. Zambia is an economy with th potential that is poised for a robust recovery, and this combination best positions the combined bank to harness these opportunities“.

Peet van der Walt, the Managing Director of Cavmont Bank, explained that: “Cavmont Bank’s vision is to be a world-class bank, rated amongst the best in Zambia. This proposed merger with Access Bank Zambia accelerates our strategy and positions us as a top ten bank in the country. As a subsidiary of one of the largest banking groups in Africa, Access Bank Zambia has the scale, capabilities and ambition to enable the combined bank to pursue exciting strategic opportunities in Zambia.

“Our customers will benefit from greater security offered by one of the most capitalised banks in the country, increased scale in Zambia, access to a broader digital and retail offering, and a geographic network across the continent. We look forward to working closely with Access Bank to deliver the benefits of the merger to all the stakeholders.” Shareholders should note that the cautionary announcement dated July 8, 2020 is hereby withdrawn and shareholders are no longer required to exercise caution when dealing in the group’s shares in relation to the potential transaction.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

Global Credit Rating Affirms Sovereign Trust Insurance A Rating

Published

on

insurance

Global Credit Rating Affirms Sovereign Trust Insurance A Rating

Global Credit Rating, an international rating agency based in South Africa, has affirmed Sovereign Trust Insurance Plc A rating in its latest report released for the month of December 2020.

In a statement released through the Nigerian Stock Exchange (NSE), Global Credit Rating noted “that the Company has shown a great deal of consistency in her claims paying obligations to her numerous customers spread all over the country.

The Report further stated that “the listing of the Rights Issue in 2019 helped in increasing the Shareholders’ funds of the Company by 33.8%, to N7.8b by the end of the Financial year in 2019 as against the figure of N5.8b in 2018.

“Subsequently, by the third quarter of 2020, the Shareholders’ funds had increased to N8.2b which also translated to a 31% increase in the corresponding period of 2019 with a figure of N6.3b. In the Rating Agency’s opinion, Sovereign Trust Insurance Plc is strong in liquidity with more than adequate claims coverage that compares well to industry averages.

“The capital adequacy of the Underwriting Firm is considered strong according to the rating report and this is underpinned by the sizeable capital base catering for the quantum of insurance and market risks assumed. In this regard, the ratio of Shareholders’ funds to NEP, (Net Earned Premium) improved to 189.2% in the Q3 of 2020 as against 130.9% in the corresponding quarter of 2019.

In terms of peer-to-peer performance comparison, “Sovereign Trust Insurance Plc did very well when compared with other selected insurers in terms of Capital, Total Assets, Gross Premium Income (GPI) and Net Premium Income (NPI).”

Continue Reading

Banking Sector

Sub Saharan Africa Mergers and Acquisition Transactions Totalled US$ 25.7 Billion in 2020

Published

on

Sub Saharan Africa Mergers and Acquisition Transactions Totalled US$ 25.7 Billion in 2020

South Africa – Refinitiv today released the 2020 investment banking analysis for the Sub-Saharan African. According to the report, an estimated US$523.7 million worth of investment banking fees were earned in Sub-Saharan Africa during 2020, down 15% from 2019 and the lowest annual total in six years.

Fee declines were recorded across M&A advisory, debt capital markets underwriting, and syndicated lending.  Advisory fees earned from completed M&A transactions generated US$108.3 million, down 55% year-on-year to the lowest level since 2013.  Debt capital markets underwriting fees declined 13% to US$64.9 million, a four-year low, while syndicated lending fees fell 3% to US$263.0 million. Equity capital markets underwriting fees totalled US$87.5 million, almost three-times the value recorded during 2019.

Fees generated in the energy & power sector account for 26% of total investment banking fees earned in the region during 2020, up from 10% during the same period last year, while the financial and technology sectors account for 17% and 13% respectively.  South Africa generated the most fees in the region, a total of US$279.9 million accounting for 53%, followed by Mozambique with 14%. Boosted by lending fees, Sumitomo Mitsui Financial Group earned the most investment banking fees in the region during 2020, a total of US$57.3 million or an 11% share of the total fee pool.

MERGERS & ACQUISITIONS

The value of announced M&A transactions with any Sub-Saharan African involvement reached US$25.7 billion during 2020, 62% less than the value recorded during 2019 when Naspers’ US$35.9 billion internet assets spin-off boosted merger activity to an all-time high.  The value of deals recorded during 2020 is the lowest annually since 2012.  The number of deals declined 5% from last year to a seven-year low.

The value of deals with a Sub-Saharan African target declined 39% to a sixteen-year low of US$12.5 billion as domestic M&A within the region declined 44% from last year and the combined value of inbound deals reached just US$7.1 billion, the lowest annual total since 2009.

Chemicals company Sasol agreed to sell a US$2.0 billion stake in LyondellBasell in October, the largest deal in the region during 2020.  Boosted by this deal, materials was the most active sector for deal making during 2020, accounting for 23% of Sub-Saharan African target M&A activity, followed by energy & power (19%) and technology (17%).  South Africa was the most targeted nation, followed by Uganda. Outbound M&A reached a three-year high of US$6.0 billion during 2020, 13% more than the value recorded during 2019.  The value was boosted by Angolan state-owned Sonangol’s purchase of PT Ventures from Africatel Holdings for US$1.0 billion and Templar Investments’ US$1.0 billion offer for Jindal Steel’s Oman unit. With advisory work on twenty deals worth a combined U$4.4 billion, JP Morgan holds to the top spot in the financial advisor ranking for deals with any Sub-Saharan African involvement during 2020.

EQUITY CAPITAL MARKETS

Sub-Saharan African equity and equity-related issuance reached US$2.5 billion during 2020, 54% more than the value recorded during the previous year, but lower than every other annual total since 2005.  The number of deals recorded increased 19% from 2019 but was lower than any other yearly tally since 2012.  One initial public offering was recorded during 2020, compared to three in 2019.  Malawian telecoms company, Airtel Malawi, raised US$28.7 million on the Malawi Stock Exchange in February. JP Morgan took first place in the Sub-Saharan African ECM underwriting league table during 2020.

DEBT CAPITAL MARKETS

The African Development Bank raised $3 billion in a “Fight Covid-19” social bond at the end of March to help alleviate the economic and social impact the Coronavirus pandemic will have on livelihoods and economies in the region.  With this deal, and Ghana’s US$3 billion Eurobond in February, Sub-Saharan African debt issuance totalled US$8.9 billion during the first quarter of 2020, the second-highest first quarter DCM total in the region of all-time.  Only US$1.9 billion was raised during the second quarter, the lowest quarterly total in eight years, followed by US$4.0 billion during the third quarter.  Prosus raised US$2.2 billion in December, boosting fourth quarter bond issuance in the region to US$4.3 billion.  The total proceeds raised during 2020 is US$19.0 billion, down 30% from last year and a four-year low.

Deutsche Bank took the top spot in the Sub-Saharan African bond underwriter ranking during 2020 with US$2.6 billion of related proceeds, or a 13% market share.

Continue Reading

Finance

DF Holdings Limited Purchases 474,603,596 Shares of AIICO

Published

on

AIICO insurance

DF Holdings Limited Purchases 474,603,596 Shares of AIICO

A majority shareholder in AIICO Insurance Plc, DF Holdings Limited, has increased its stake in the company by purchasing additional shares of 474,603,596.

In a disclosure statement published through the Nigerian Stock Exchange (NSE) and signed by Donald Kanu, the Company Secretary, AIICO, DF Holdings Limited purchased the shares on 31, December 2020 from the Nigerian Stock Exchange in Lagos Nigeria.

The 474,603,596 shares were purchased at N1.17k per share. Meaning, DF Holdings Limited invested N555.286 million in AIICO Insurance. See the details below.

Continue Reading

Trending