African Bank Limited, a leading retail bank, led by South African business executive Kennedy Bungane, has successfully concluded a comprehensive acquisition deal with Sasfin Bank Limited.
The transaction, valued at R3.2 billion ($166 million), encompasses Sasfin Bank’s Capital Equipment Finance Business (CEF Business) and Commercial Property Finance Business (CPF Business).
The announcement, made today, marks the culmination of a journey that began with the binding heads of agreement announced on Oct. 13, 2023. The acquisition aligns with the bank’s ‘Excelerate25’ strategy, focusing on expanding its core and establishing a footprint in the business banking market.
Key agreements finalized, propelling African Bank’s expansion in capital equipment and commercial property finance sectors
The finalized agreements, inked on Feb. 16, 2024 (as amended) and February 22, 2024, underscore the commitment of all parties involved to navigate the intricacies of this multifaceted transaction. The adjusted composite value of the transaction, approximately R2.9 billion ($150.5 million), solidifies African Bank’s position as a key player in the capital equipment and commercial property finance sectors.
The CEF Business is valued at approximately R2.61 billion ($135.4 million), including the advances book and a goodwill component, based on Oct. 31, 2023, values. Simultaneously, the CPF Business is valued at approximately R290.2 million ($15.1 million), including the advances book and associated profit shares, if any. This significant acquisition places African Bank in a robust position in these key financial sectors.
The purchase price for both businesses will be disbursed in two tranches. Ninety-three percent of the estimated loan book value will be settled on the closing date, showcasing African Bank’s commitment to swiftly integrate these businesses. The remaining 7 percent will be paid no later than 120 calendar days after the Closing Date, demonstrating a prudent financial planning strategy.
African Bank’s phenomenal growth: From 1.54 million to 3.97 million active users in a year
African Bank’s successful acquisition of Sasfin Bank’s Capital Equipment and Commercial Property Finance Businesses underscores its commitment to strategic growth and diversification, positioning itself as a key player in South Africa’s financial landscape.
Under the leadership of Bungane, African Bank Limited has experienced massive growth, becoming one of the fastest-growing financial services providers in South Africa.
Active customer figures jumped from a total of 1.54 million in the previous 2022 fiscal year to 3.97 million active users in the year ending Sept. 30, 2023. This growth was supported by the introduction of the business bank and alliance banking segments.
