Merbank up for sale again

The Social Security and National Insurance Trust (SSNIT) is to commence a new process to invite proposals from interested parties for the acquisition of Merchant Bank Ghana (Merbank) Limited.

The move follows the inability of SSNIT, the majority shareholder of the bank, and FirstRand of South Africa to consummate the deal to allow the later to acquire majority stake in the financially distressed bank.

The second biggest financial group in South Africa, FirstRand, was hoping to acquire 75 per cent stake in the bank for GH¢176.4 million.

A joint statement from the two parties signed by Eva Amegashie, Corporate Affairs Manager of SSNIT, said the original legal and regulatory time frame agreed for FirstRand's offer to acquire Merchant Bank Ghana (MBG), announced in August 2012, had officially lapsed.

“Despite all reasonable endeavours, the parties were unable to reach an agreement on the commercial principles underlying the transaction and could not procure the fulfillment of all the conditions precedent. Therefore the transaction cannot be completed and has lapsed”, it said.

Meanwhile, FirstRand is said to have expressed its disappointment that the transaction could not be concluded, although it indicated its intention to make Ghana a priority for its expansion.

The bank further pledged its resolve to continue to engage with SSNIT on its new process.

BoG on the deal

Myjoyonline had reported on its website that the Bank of Ghana was about giving its final approval to the takeover of Merchant Bank by First Rand of South Africa.

According to a statement it issued earlier in the year, the bank had no objection in principle to the takeover.  It however noted that there had been some "public interest" concerns which were being resolved by SSNIT, Merchant Bank and First Rand Bank.

The regulator had added that it believed these concerns would be addressed soon to pave the way for the approval.

About First Rand

First Rand Limited, also referred to as First Rand Group or as FirstRand Bank, is a financial service provider in South Africa, licensed by the Reserve Bank of South Africa, the national banking regulator.

First Rand Bank was established in 1998 from a business that started in 1970 as an investment bank. Today, one of the three founders serves as the non-executive chairman of the group’s board of directors.

The group was formed by the merger of First National Bank (South Africa), Rand Merchant Bank and Momentum Insurance & Asset Management and has its headquarters in Johannesburg with five subsidiaries in five South African countries, namely: Botswana, Lesotho, Mozambique, Namibia and Zambia, as well as Australia and India.

First Rand’s net worth was about US$2.6billion as at December 2011 and its total US$90.3+ billion

By Charles Benoni Okine/Ghana