Gaborone, Botswana, August 17, 2007
— IFC, a member of the World Bank Group, will invest $20 million to help ABC Holdings diversify and expand its regional operations. This will boost the company’s goal to help develop Africa’s financial markets significantly.
IFC’s investment will consist of a 10 percent equity stake of ABC Holdings’ issued share capital. The remainder will comprise a loan that may be convertible to common shares. The holding company will use the proceeds of the loan to increase the capital of its subsidiaries in Botswana, Mozambique, and Zambia. This is subject to shareholder approval at a general meeting in Gaborone on September 21, 2007.
“As a proud African group with a passion for creating wealth for all our stakeholders, we are excited about building a collaborative partnership with an organization whose vision aligns with ours,” said Oliver Chidawu, Chairman of ABC Holdings. “In addition to boosting our financial resources and enhancing our capacity to handle larger transactions, this agreement gives us access to a strong intellectual resource base that will accelerate our progress in achieving our vision – to be an institution that delivers world-class, financial solutions for Africa.”
IFC will work with ABC Holdings and its subsidiaries to create an African benchmark that improves corporate governance and risk management. IFC’s advisory work will aim to help the banking group develop its operations, diversifying products in such areas as mortgage lending to reach a larger number of clients across the region.
“Improving access to finance for individuals and businesses is one of the key components of IFC’s strategy in Sub-Saharan Africa’s financial markets,” said Jyrki Koskelo, IFC Director for Global Financial Markets. “Partnering with ABC Holdings will enable us to work together to achieve this important goal.”
The financial architecture of many African countries remains weak and is often dominated by foreign banks. ABC Holdings, one of the few locally owned regional banking groups, can help bridge this gap by expanding and strengthening institutions that provide specialized financial services such as investment banking, asset financing, and asset management. These are key areas in developing capital markets and providing sustainable financing to the private sector.
About IFC
IFC, a member of the World Bank Group, fosters sustainable economic growth in developing countries by financing private sector investment, mobilizing capital in the international financial markets, and providing advisory services to businesses and governments. IFC’s vision is that poor people have the opportunity to escape poverty and improve their lives. In FY06, IFC committed $8.3 billion, including syndications, to 284 investments in 66 developing countries. For more information, please visit
www.ifc.org
.
About ABC Holdings
ABC Holdings, a brand name for African Banking Corporation, is a Botswana-registered company with a primary listing on the country’s stock exchange. It also has a secondary listing on the Zimbabwe Stock Exchange. The group has operations in Botswana, Mozambique, Tanzania, Zambia, and Zimbabwe, as well as a representative office in South Africa.
