Capitec Bank has emerged as the victor with its bid to acquire the local assets of Mercantile Bank.
In a Sens announcement late on Thursday Capitec declared that its R3.2 billion offer had been accepted.
The purchase consideration will be paid from capital and cash reserves.
Capitec shrugged off competition from Nedbank and the Public Investment Corporation (PIC), which had also been shortlisted to participate in the second phase of the sale of Mercantile Bank following approval by the Portuguese government. The PIC, Africa’s largest asset manager, manages public sector funds in excess of R1.9 trillion.
Capitec said it believes there are many opportunities in the market to serve small-to-medium enterprises and owner-managed businesses better, adding that the bank has commenced with a strategy to develop infrastructure to facilitate the same. “The acquisition of Mercantile will obviate the need to reinvent and create new systems and processes from scratch and thus fast-track the bank’s objective to expand its focus to a broader bank strategy,” said Capitec in a statement.
Mercantile Bank CEO Karl Kumbier said he was very excited that Capitec has chosen Mercantile as its partner to build the best business bank in the country.“Capitec is a brand that is associated with hard work, innovation, and disruption,” he said. “It is the fastest growing bank in the country and has over 10 million clients.”
While the sale agreement is yet to be signed by all parties, and is subject to approval by the relevant South African regulatory bodies, Kumbier says the bank is looking forward to the next phase of its growth journey.
“As an organisation, we are grateful for the guidance and support we have received from Caixa Geral de Depósitos (which owns 100% of Mercantile bank) over a long and successful relationship. However, we are very excited about the potential new opportunities we can unlock under the ownership of Capitec, a bank that has been bold in its strategy and focused in its execution.”