The arrival of Robert Diamond’s Atlas Mara has set heads rolling at Banc ABC parent company, ABC Holdings. Simbarashe Pfende, previously headed Standard Bank’s operations in Nigeria and Uganda, will lead a new management team picked by Bob Diamond’s Atlas Mara to take over the reins at Botswana-based banking group, African Banking Corporation (ABC).
Diamond and Ashish Thakkar, a Ugandan businessman – who founded Atlas Mara – are buying banking properties across the continent, which they say offers massive investment opportunities.
Their company, which raised more than $320 million (P3.5 billion) in an initial public offering in December last year, bought into ABC, which owns the BancABC banking operations in Zimbabwe, Botswana, Zambia, Tanzania and Mozambique. The transaction, which marked Atlas Mara’s first entry into the African banking scene, had a value of about $265m.
However, the changes at the parent, will not affect the Botswana chapter of BancABC.
The company said on Monday that the departure of the BancABC management team – including chief executive Douglas Munatsi, chief financial officer Beki Moyo and Francis Dzanya, the group’s chief operating officer at the end of this year – would result in the regional banking group incurring a once-off income charge of nearly $5.8m in the last quarter of the current year.
According to a release by ABC, Munatsi, Moyo and Dzanya received a total of 1 743 888 Atlas Mara shares in consideration for the transfer of their shares in ABC Holdings at the time of the completion of the BancABC acquisition. It added that "in connection with" the departure of the three, Atlas Mara had agreed to purchase their shares at a price of $10 per share.
The company said that the repurchased shares would be held in treasury, in addition to other arrangements agreed at the time of the transaction.
"The departing management team has been granted options over a total of 1 521 838 ordinary shares. The options have a strike price of $12 per share and are also subject to certain repurchase obligations." Zimbabwean economist Jeffrey Kasirori said that the African banking scene, especially in markets such as Zimbabwe, Mozambique and Zambia required high investment to sustain.
He added that the departure of the management at BancABC would have been part of the agreements under the transaction that saw Atlas Mara buy into ABC.
APPOINTMENTS John Vitalo, the current chief executive at Atlas Mara, has been appointed interim chairman of BancABC while Bradford Gibbs, who sits on the investment group’s executive committee, now occupies a position on the new board of the regional banking group.
Atlas Mara said it had also appointed Makhosi Boyede, a former executive with Absa, and former Barclays’ head of operations, Amelia Reynecke, as joint chief operating officers.
Pfende will lead the new team as chief executive, tasked with maintaining the group’s operations on a growth trajectory in all its regional markets.
Clergy Simatyaba, the managing director at the Zambian BancABC unit, said that "the 100 percent acquisition" of BancABC by Atlas Mara had boosted "operations because we have both local and international" expertise. ABC Holdings has 100 percent stake in Banc ABC in Botswana, Zambia, Zimbabwe, Mozambique, and a 94 percent stake in Tanzania.
Robert Diamond’s HYPERLINK "http://www.bloomberg.com/quote/ATMA:LN" o "Get Quote" Atlas Mara Co-Nvest Ltd. (ATMA) is reportedly looking for more acquisitions in Southern Africa after buying lenders in Botswana and Rwanda. “We will be as aggressive as we can within the limits of prudence,” the company executives have been quoted as saying, with the company looking at a number of potential deals in Southern Africa.
Diamond, who quit as Barclays CEO in 2012 in the wake of a fine for manipulating benchmark interest rates, and Ugandan entrepreneur Ashish Thakkar raised $325 million in an initial public offering last year. The investment firm, to which Diamond and Thakkar committed $20 million of their own money, is looking for African financial-services companies that can help businesses manage currency and commodity risks.
Atlas Mara has raised a total $825 million in equity and debt, the bank earlier August this year, completed the acquisition of Botswana’s BancABC and is also buying a 77 percent stake in the commercial arm of the Development Bank of HYPERLINK "http://topics.bloomberg.com/rwanda/" Rwanda from the government.
ABC Holdings Limited is the holding company for a number of operating companies across sub-Saharan Africa each with independent banking licenses. ABC Holdings head office is in Botswana where it is listed on the Botswana Stock Exchange as well as a secondary listing on the Zimbabwe Stock Exchange.
In the coming months prices will go up and inflation will shoot sharply above the target of 3 percent to 6 percent towards the third quarter of 2021, the Bank of Botswana on the other hand will continue to withhold its knife on the Bank Rate. This is according to a forecast made by Kgori Capital in its recent Market Watch Segment.
Statistics from Statistics Botswana show that the recent 1.8 percent increase in the September inflation, from 1 percent in August, was a reflection of the upward adjustment in public transport fares (Transport (from -6.9 to -3.9 percent) in September 2020, which is estimated to have increased inflation by approximately 0.64 percentage points.
Local anti-trust body, Competition and Consumer Authority (CCA), this month received back to back acquisition proposals from South African clothing retailers to wipe out their former rivals, Edcon, from Botswana malls.
Last week BusinessPost was in possession of Merger Notice No 23 of 2020 whereby a South African clothing retailer owner, Retailability Proprietary Limited, through Oclin Proprietary Limited, proposed to acquire parts of the Edgars business conducted by Edcon in Botswana (through Edcon Botswana), as a going concern, consisting of certain assets and identified liabilities.
South African government’s Business Rescue Practitioners earlier this year announced that Retailability will buy Edgars, after the latter filed for a business rescue plan in April after it failed to pay suppliers. This move will see Retailability add Edgars to its portfolio consisting of brands such as; Legit, Beaver Canoe and Style.
Retailability landed on Botswana shores 18 years ago with its flamboyant urban fashion Style which had 17 stores. Style, having almost the same target market as Edgars as it offers men’s and ladies’ contemporary and formal fashion, gave the 91 year old legendary clothing retailer a run for its money, and has won the battle as its parent company has taken over Edgars.
Retailability brands are synonymous with Botswana shopping centres and there are currently five (5) Beaver Canoe stores, 10 Style stores and seven (7) Legit stores across this country. The Beaver Canoe stores sell clothing apparel for men and boys only. The Legit stores have a fashion store format which focuses on the retailing of clothing, footwear, accessories, colour cosmetics and cellular products.
Retailability operates in over 460 stores across South Africa, Namibia, Botswana, Lesotho, and Eswatini. Many observers suggest that because of the deal with Retailability to swallow Edcon, most Edgars stores in Botswana will change their name and be branded Style. A sad tale for religious consumers of the Edgars trademark who got used to love their favourite brand for years.
According to CCA’s Merger Notice No 23 of 2020, Retailability is controlled by Clifford Raymond Lines (through a company which functions solely as a holding company of his interests in Retailability) and Metier Investment and Advisory Services Proprietary Limited (“Metier”). Metier is a private equity enterprise with investments in a number of industries spanning from healthcare, hospitality, FMCGs and telecommunications.
Retailability directors are mostly South Africans; Clifford Raymond Lines, Mark Richard Friday and Norman Victor Drieselmann. Only Nasreen Essack, who was appointed February this year, is a Motswana. He comes after Brian Thuto Tsima left on the same date. Retailability 100 percent owns Oclin Proprietary Limited, the company it is acquiring Edgars with, by a capacity of 3000 shares.
The target business, Edgars, offer textiles, cosmetics and cellular products. Edcon has a Motswana director, Charles Mzwandile Vikisi, a South African, Shane Van Niekerk and Zimbabwean Jethro Kamutsi.
“The Target Business comprises of two (2) Edgars franchise brands and private label stores across Botswana. These stores target middle to upper income customers and are home to a range of private label brands such as Free2BU, Charter Club and Stone Harbour, and a wide range of market label brands (such as Levi’s and Guess) for clothing, footwear and cosmetics.
In addition, the Target Business operates iconic Edgars Home and Edgars Beauty stores as store-in-store formats rounding out the department store offering in Botswana,” said CCA. Foshini also lines up to take Jet Botswana from Edcon.
The Foschini Group (TFG) released a statement confirming its latest intentions to acquire Edcon assets or Jet for a cash purchase consideration of R480 million. This was after the business rescue practitioners offered TFG to buy Jet by that amount.
CCA is currently mulling on a proposed merger by TFG to take over Jet operations in Botswana. Merger Notice No 21 of 2020 from TFG came a few days before the Retailability proposal. In this merger TFG, acting through Foschini Botswana, want to take over “parts” of the Jet business conducted by Edcon through Jet Supermarkets Botswana.
TFG will be willing to add Jet to its portfolio of 30 retail brands that trade in clothing, footwear, jewellery, sportswear, homeware, cell phones, and technology products from value to upper market segments throughout more than 4085 outlets in 32 countries on five continents. TFG will also get Jet’s distribution centre located in Durban and certain stores in Botswana, Lesotho, Namibia and Eswatini. Also part of this fat deal is that the company is looking to also acquire JET Club and all existing JET stock of no less than R800 million.
Johannesburg listed TGF owns Foschini Retail Group which owns the local operations called Foschini Botswana, the acquiring enterprise according to CCA merger notice. “TFG is not controlled by any enterprise/s and for completeness, the three largest shareholders of TFG holding shares greater than 5% as at 27th March 2020 are: Government Employees Pension Fund (16.2%) Public Investment Corporation (13.2%); Old Mutual Limited (6.7%); and Investec Asset Management (6.3%). The remaining issued share capital in TFG is widely held,” said the merger notice.
Only Abdool Rahim Khan is a Motswana in the Foschini Botswana directorship, the rest; Ganeswari Shani Naidoo, Anthony Edward Thunström and Gustav Jansen (alternate director) are South Africans.
According to the CCA merger, the Jet Business is Edcon’s discount department store division, selling clothing, footwear, homeware and some cosmetics as well as cellular products and targets lower-to-middle income consumers throughout Botswana. The Jet Business does not directly or indirectly control any enterprises, says the notice. CCA seeks any stakeholder views for or against the proposed merger, which may be sent within 10 days from date of this publication to the following address.
Botswana Communications Regulatory Authority BOCRA signed a memorandum of Agreement (MoA) with the Ministries of Transport and Communications (MTC), Basic Education (MoBE) as well as Local Government and Rural Development (MLGRD).
The MoA seeks to continue the collaboration that dates back to 2016 when the three parties first agreed to work together in a project aimed at computerizing and providing broadband Internet to primary schools in remote and underserved areas of Botswana.
The project benefitted 68 primary schools and 9 secondary schools through the construction of Local Area Network (LAN) in each primary school, provision of 5 Mbps dedicated broadband Internet to each Primary School and provision of Wi-Fi enabled tablets, laptops and related peripherals such as printers and copiers.
Further, the project will see the augmentation of computers in 9 Junior Secondary Schools with 30 laptops per identified school and employment of Information Technology (IT) officers at each primary school.
When speaking at the signing ceremony in Gaborone, Chief Executive of BOCRA and Chairperson of Universal Access and Service Fund (UASF) Board of Trustees Martin Mokgware said the project’s ultimate goal is to facilitate pupils in schools and host villages to be able to play a meaningful role in the digital economy.
Mokgware indicated that this necessitates upgrading of existing Telecommunications infrastructure to high capacity broadband that will support delivery of education, accessibility to the quality Internet and usage of ICTs.
The Fund began its inaugural programme by sponsoring the provision of WiFi hotspots in public areas around the country as its first project. Following the successful implementation of public WiFi hotspots, the Fund identified Kgalagadi, Ghanzi and Mabutsane areas for mobile network upgrades, schools computerization and internet provision.
Conscious that the project would not be possible without buy-in and support from MoBE, MTC and MLGRD, the Fund facilitated the signing of the first MoU between the three parties in 2016 for implementation of the project.
BOCRA Chief Executive said the signing of this agreement is aimed at benefitting the Kweneng District, adding that they have already assessed the area and have determined that they will be covering 62 underserved villages and 119 schools, 91 of which are primary schools.
“This is a project for which the partner Ministries need to re-commit for its success. Lessons from the previous schools’ computerization and internet connectivity project require that we increase our involvement and resources dedicated to the project for it to be successful. It is my belief as the project coordinator, that we will not do things the way we did them during the first project, for if we do, then we will not have learnt anything,” he said at the signing ceremony.
The purpose of learning is so that there can be continuous improvement to minimize the length of time and amount of resources utilized, he said expressing confidence that their partners will step up to the plate and ensure they play their part in the implementation of the project and that it will progress smoothly having already tread along a similar path.
UASF’s role lies mainly in funding and project management. According to Mokgware, once the project is completed, the work to integrate ICTs into the classroom begins in earnest. Therefore, he said, the project will not succeed without full cooperation and oversight of partners.
“MoBE will put in place the necessary content and ensure that the curriculum is available to all. MLGRD will provide, among others, the enabling environment by ensuring readiness of the school’s infrastructure and necessary security.”