African Bank acquires Sasfin unit as IPO nears

African Bank Holdings Ltd. has made a strategic move to bolster its lending business in preparation for a proposed initial public offering in 2025 by acquiring two units from a South African financial services company. The bank has purchased the commercial property and capital equipment financing businesses from Sasfin Holdings Ltd.’s units for 3.26 billion rand (approximately $172 million), as announced in a recent filing.

This acquisition marks the third such move by African Bank in just over a year. In the past year, the bank acquired Grindrod Bank Ltd. for 1.5 billion rand and UBank Ltd. for 80 million rand. These acquisitions are part of the bank’s efforts to rebuild its business and recover from a crisis it faced in 2014, which necessitated a bailout from the central bank.

African Bank’s Head of Business Banking, Zweli Manyathi, stated that this expansion aims to provide a more appealing proposition for investors. The acquisition reflects the bank’s commitment to diversify its business banking operations, revenues, asset classes, and risk profile.

The purchase encompasses Sasfin Bank’s capital equipment finance unit and Sasfin Private Equity Investment Holdings Proprietary Ltd.’s commercial property finance business. Manyathi also noted that this transaction will enable African Bank to offer customers transactional accounts, internet banking, and mobile banking options. Furthermore, a team of five professionals from Sasfin managing the commercial property financing business will join African Bank.

African Bank has been exploring options for shareholders, including the South African central bank, to exit the institution. Notably, the South African Reserve Bank, which typically does not hold stakes in banks, had taken up shareholding alongside the Government Employees Pension Fund to rescue African Bank from collapse. With the 2025 initial public offering (IPO) plans, the central bank intends to divest its 50% stake in the bank.

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