JSE-listed Bidvest announced on Thursday its plans to sell Bidvest Bank Holdings to Access Bank Plc for approximately R2.8 billion.
The proceeds from the sale will be allocated to settling existing debt.
Bidvest will continue to support Bidvest Bank to ensure that it remains financially sound an operationally stable throughout the disposal process,” the company informed investors.
Access Bank, a full-service commercial bank with over 60 million customers worldwide, has been operating in South Africa since 2021 following its acquisition of Grobank. The bank serves its customers through a network of more than 700 branches across 23 countries on three continents. It has a strong footprint in Nigeria, 16 African subsidiaries, and representative offices in the UK, China, Hong Kong, the UAE, India, and France.
As part of its South African operations, Access Bank plans to introduce B-BBEE ownership, including an employee stock ownership plan, according to a statement released on Thursday.
For the 2024 financial year, Bidvest Bank reported trading profit and operating income of R371 million and R377 million, respectively. Its book, primarily consisting of leased assets, loans, and advances, totaled R6 billion, funded mainly by R8 billion in deposits.
The transaction’s completion is contingent on regulatory approvals, which Bidvest’s management anticipates will be finalized within six months, targeting an effective date before the end of the current financial year.
In a related move, Bidvest has entered into an agreement to sell 100% of FinGlobal to Momentum Group, with all employees retained as part of the transaction. Additionally, Bidvest has received binding offers from established life insurers for 100% of Bidvest Life, with one of these offers expected to progress to an agreement in the coming weeks.
Bidvest Bank, FinGlobal, and Bidvest Life will be classified as a disposal group held for sale in Bidvest’s consolidated financial statements for the financial year starting July 1, 2024.
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.
