adminadvantage of the distressed share price of African Banking Corporation to increase its influence further. ADC recently took advantage of the low share price and acquired a majority shareholding in ABCH at a price calculated by taking the average share price of the company traded on the Botswana Stock Exchange over the last three months.
With an additional 82 million shares and a share price of the underwriting of US0,6c, the reduced share price (US0,35c decrease relative to year-end) led to a lower cash investment outlay by US$28,7 million (23,3 million euros).
This resulted in ADC increasing its equity in ABCH to a controlling 50,4 percent. ADC initially held 23 percent of the regional financial services group.
Dirk Harbecke, chief executive of ADC, said: “ADC’s strategy of becoming a pan-African banking group has taken a giant leap forward in the past weeks after the acquisition of a strategic stake in the Union Bank of Nigeria and becoming the majority shareholder in BancABC.
“We aim to use the current distressed prices at BancABC to further increase our influence.” ABCH’s share price dropped from around US0,95c at the end of 2011 to US0,55c by the end of the second quarter.
ABCH recently raised US$50 million to recapitalise all subsidiaries in Zimbabwe, Botswana, Zambia and Tanzania. The capital raising placed all the subsidiaries, which trade as BancABC, either in the top tier or upper second tier of banks in countries in which the group operates.
Meanwhile, ADC has published its interim results for the first half-year of 2012.
Consolidated revenues and other income for the first six months increased by 47 percent to 1,9 million euro up from 1,3 million euro in the comparable period last year. The group recognised non-cash-relevant fair value losses of 15,2 million euro in the first half of 2012.
The Frankfurt-listed firm said losses of about 10,5 million euros were recognised in ABCH due to the market-to-market valuation and a decline of its share price.
As of June 30, 2012, ADC had shares in associated companies on the balance sheet valued at 64,8 million euros, up 32 percent from 49,2 million euros at year-end of last year. The group had cash and cash equivalents of 45,1 million euros at the end of the first half year, up from 43,3 million euros as at December 31, 2011.
The company’s total equity reached 70,1 million euros compared with 88,3 million euros at year-end 2011.
The group’s balance sheet grew by 13 percent to 116 million euros at June 30, 2012 from 103,1 million at December 31, 2011. ADC is a listed financial services group company focusing on the highly profitable banking and insurance market as well as on proprietary investments in selected frontier markets in sub-Saharan Africa.
It focuses on making growth capital investments available, following an active management approach and knowledge transfer delivering operational added value to its portfolio companies.
Online Reporter