Atlas Merchant Capital, Mara Group partnership reaches cash and share deal with ABC Holdings and ADC African Development Corporation
Atlas Mara Co-Nvest, a joint venture between Bob Diamond’s New York-based Atlas Merchant Capital and the Dubai-based Mara Group, will acquire the Sub-Saharan banking group ABC Holdings and its shareholder ADC African Development Corporation (ADC) for $265m in cash and shares.
The company disclosed the details of the agreement with ABC Holdings (“BancABC”) after a statement by the group, additionally revealing the further deal with the pan-African ADC group to make a voluntary public takeover offer (by way of an exchange offer) for all outstanding shares. With the combination of BancABC, ADC and Atlas Mara, we can build a truly pan-African financial institution to address needs across the continent.
In terms of the deal’s structure, Atlas Mara has reached conditional purchase agreements with selected shareholders of BancABC, to acquire, for cash or shares, in excess of 50.1% of BancABC’s total outstanding shares for $0.82 a share, or the equivalent in Atlas-Mara shares.
Bob Diamond, Barclays ex-CEO and Atlas founder, said: “Our objective is to build Africa’s premier financial group by leveraging Atlas Mara’s access to capital to partner with exceptional multi-country African financial services companies just like BancABC and ADC.
“Our future growth will be based on expanding on Dirk Harbecke’s vision at ADC and on the foundation created by Douglas Munatsi and his team at BancABC, who have built a fast-growing, prudently-managed, African banking institution.” Related article Africa’s growth cities attract increased foreign real-estate investment
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Mara Group founder Ashish Thakkar added: “With the combination of BancABC’s regional expertise, ADC’s initial platform and Atlas Mara’s global experience, we can build a truly pan-African financial institution to address needs across the continent for a meaningful and lasting positive impact.”
Atlas Mara has also entered into a ‘business combination agreement’ with ADC, which holds a further 47.1% stake in BancABC, to make a public share-for-share takeover offer for all outstanding shares of ADC at an exchange ratio of 1.25x Atlas Mara shares per ADC share.
ADC shareholders representing 34.1% of ADC’s shares outstanding have already provided irrevocable undertakings to tender their shares into the voluntary share-for-share offer.
With the completion of this business combination, Atlas Mara will be extending a mandatory public offer for the outstanding 13% of shares in BancABC represented by ADC for cash and/or Atlas Mara shares, at the aforementioned price of $0.82 a share or share equivalent.
The transactions are being funded through the $325m proceeds of Atlas Mara’s 2013 IPO and share issuance. BancABC’s CEO, Douglas Munatsi, will also join the executive committee of Atlas Mara, which will provide up to $100m of equity to BancABC to drive its growth.
Based in Botswana, BancABC is a leading bank for the $640bn net-GDP Southern African Development Community (SADC), with roots in Botswana, Mozambique, Tanzania, Zambia and Zimbabwe since 1956, and a 42% CAGR in loan book growth over the past 5 years.
ADC is a Frankfurt-based but pan-African banking group that has an indirect 47.1% stake in BancABC (inclusive of a 9.3% stake subject to a call option with BancABC’s management), an indirect 9.1% stake in Union Bank of Nigeria, and a portfolio of other private equity holdings.
Bob Diamond is founder and CEO of Atlas Merchant Capital (AMC), an investment firm in the style of a traditional merchant bank with a focus on Africa, as well as the former group CEO at Barclays, where he similarly built the investment bank, Barclays Global Investors.
Diamond is also involved in several Africa initiatives, as co-chair and president of the New York Chapter of Invest Africa, The Diamond Family Foundation (DFF) multiple organizations in Africa including UNICEF, the Aegius Trust and Tony Blair Africa Governance Initiative.
Ashish Thakkar is a UK-Ugandan entrepreneur, responsible for starting the Dubai-based Mara Group, which now commands $200m in revenue, with just £5,000, and also the Mara Foundation. Thakkar continues to rise as one of the leading technology businessmen on the African continent.
With the combination of BancABC, ADC and Atlas Mara, we can build a truly pan-African financial institution to address needs across the continent.