FBC sees drop in Stanchart final purchase price

FBC Holdings Limited (FBCH), which acquired 100 percent of Standard Chartered Bank PLC, has seen its final purchase price drop to US$23 million from the initial US$34 million.

FBCH, through FBC Bank Limited, had deposited US$34 million with Standard Chartered Bank UK, the subsidiary of the British-based financial group Standard Chartered PLC, which owned the then Standard Chartered Bank Zimbabwe.

An escrow account was set up in which FBCH, through FBC Bank Limited deposited the amount. The Escrow amount was based on the indicative net asset value using a proforma “Completion Balance Sheet” computed as at March 31, 2023.

However, in an update last week, the financial institution revealed a US$10 million lower purchase price.

“Further to previous communications and the resolutions of the Extra-ordinary General Meeting of the Company held on the 28th of September 2023, the board of directors of FBC Holdings Limited (FBCH) wishes to announce to shareholders, the investing public and all stakeholders that the final purchase consideration for the acquisition of Standard Chartered Bank Zimbabwe (SCBZ) and the entire beneficial interest in the Africa Enterprise Network Trust (AENT) was US$23 896 650 00,” reads part of the statement.

“As a result, US$10 103 350 00 has been returned to FBCH from the original US$34 million lodged into the escrow account at transaction initiation.”

The bank said the purchase consideration has been satisfied by the terms of the sale and purchase agreement. The transfer and official handover of SCBZ operations and ceding of the entire beneficial interest in the AENT to FBCH occurred on May 18, 2024.

FBCH said the strategic acquisition will significantly enhance its shareholder value. In terms of the rationale and benefits of the transaction, the group said it leveraged the two banking entities’ respective strengths, capabilities, and competencies to create dynamic banking operations, allowing the merged entity to enhance its loan underwriting capacity and enabling the group to serve a broader range of customers across different market segments.

This will also enable the group to achieve economies of scale and operational efficiencies by consolidating back-office operations, systems, and resources, reducing duplication, and enhancing productivity and profitability.

Standard Chartered Bank Zimbabwe has rebranded to FBC Crown Bank Limited.

In April 2022, Standard Chartered PLC announced its decision to divest from several markets, including Zimbabwe, and, consequently, Standard Chartered Bank Zimbabwe Limited was put up for sale.