The Bidvest Group board has approved the process to dispose of Bidvest Bank and its related entity, FinGlobal. This decision is part of a broader strategic restructuring aimed at aligning and strengthening the group’s core business operations.
The short-term insurance businesses within Bidvest’s Financial Services division, which primarily focus on vehicle insurance and related value-added products, will be transferred to the Automotive division. This move supports the Automotive division’s strategy of diversifying into allied automotive services.
The disposal process for Bidvest Life, which had been announced previously, is currently underway.
Following these disposals, the Bidvest Group will comprise six divisions: Services International, Freight, Services South Africa, Commercial Products, Branded Products, and Automotive.
Additionally, Adcock Ingram will remain a majority-owned subsidiary of Bidvest. This strategic restructure is designed to facilitate the recycling of capital, thereby supporting the Group’s continued growth.
Next Steps
The formal disposal process for Bidvest Bank and FinGlobal will be initiated imminently, with the aim of identifying suitable acquirers by the end of the 2024 calendar year. These transactions will be subject to various regulatory approvals.
During this transition period, Bidvest Group is committed to ensuring that Bidvest Bank remains financially sound and operationally stable. The well-being of employees and maintaining high-quality service standards for all clients will remain top priorities.
The disposal of Bidvest Bank will require several regulatory approvals.
Bidvest will engage appropriately with the relevant regulators and other bodies throughout this process.
Financial Overview
For the financial year 2023, Bidvest Bank generated a trading profit of R234 million and an operating income of R219 million. The bank’s book, which consists mainly of leased assets, loans, and advances, totaled R5 billion, funded by deposits of R8 billion. Cash and investment securities amounted to R6 billion, including R4 billion in restricted cash from a Group perspective.
This strategic move marks a significant milestone for the Bidvest Group as it continues to evolve and adapt to changing market dynamics, ensuring sustained growth and value creation for its stakeholders.
“The opportunity to facilitate a step-change in value-creation for all stakeholders doescnot arise often. The strategic restructure of Bidvest Financial Services allows us to set these businesses up for their next phase of sustainable expansion whilst recycling capital to position the Group for continued growth.” Mpumi Madisa, chief executive.
