09 December 2016 – Financial services group, Capricorn Investment Group Limited (CGP) recently announced to their shareholders that it will acquire the controlling issued share capital of Capricorn Investment Holdings Botswana (CIHB) and Cavmont Capital Holdings Zambia (CCHZ).
In terms of the agreement, the group will acquire 65% of the issued share capital of Capricorn Investment Holdings (Botswana) Limited, which owns 100% of the share capital of Bank Gaborone, and 97.9% of Cavmont Capital Holdings Zambia Plc, which owns 100% of the share capital of Cavmont Bank.
Capricorn Investment Holdings Limited (CIH), the ultimate holding company of CGP, holds shareholdings of 80.6% and 73% in the issued ordinary share capital of the Botswana and Zambia entitites, as at the effective date.
The 15.6% shareholding in CIHB retained by CIH is to honour a commitment to a local Botswana investor. CGP will, in addition to the 73% acquired from CIH in CCHZ, acquire an additional 24.9% in CCHZ on the same terms from other minority shareholders.
The transaction is seen as a key enabler to achieve CGP’s aim to diversify the business interests of the group and expand its footprint outside Namibia.
This transaction will also strengthen the already close collaboration and alignment between the entities in the three countries through the shared interest held by CIH. The banks are already aligned to the group risk methodologies, policies and technology platforms and have also adopted the “As One” strategic initiatives of the group.
Bank Gaborone Limited is a relatively new bank in Botswana that opened its first branch in September 2006. The bank has a market share of approximately 6% with 8 branches, 3 agencies and 9 BG Finance (micro finance) branches. Bank Gaborone was recently recognised by a KPMG survey as the most customer focused bank in Botswana.
Cavmont Bank Limited was established on 1 January 2004, following a merger between Cavmont Merchant Bank Limited (incorporated October 1992) and New Capital Bank Plc (incorporated June 1992). The bank was historically a savings bank but was subsequently repositioned as a full scope retail and commercial bank. The bank has a network of 17 branches and 3 agencies in 6 of the 10 provinces in Zambia. Cavmont Bank received the accolades of Best Retail Bank Zambia and Best Customer Service Bank Zambia by Global Banking and Finance Review for 2016.
CGP will purchase the shares of CIHB and CCHZ from the vendors for a consideration of P240.9 million and K81.0 million, respectively. Based on the exchange rates at 30 November 2016 of P0.7676 and K0.7053, the purchase consideration amounts to N$428.8 million.