Old Mutual buys stakes in FMB Capital Holdings

Post was last updated: January 14, 2019

By Taonga Sabola:

Old Mutual Investment Group (Omig) has acquired 4.96 percent stakes in Malawi Stock Exchange (MSE) – listed FMB Capital Holdings (FMBCH).

The deal, which is worth K8.54 billion, follows the issuance of 122 million new shares by the Mauritius-based FMBCH.

The share issue has increased the free float of public shareholders of the FMBCH and added considerably to the breadth and diversity of its shareholder base.

FMBCH Group Managing Director, Dheeraj Dikshit, says in a statement, the additional capital raised further augments t h e company’s regulatory capital and will be applied to fund short to medium term growth initiatives across the Group.

“The additional capital will enhance the group’s ability to grow and solidify our position as a leading banking group in the Southern African region,” Dikshit says.

FMB Capital Holdings, incorporated in Mauritius, has a controlling interest in banks which operate as First Capital Bank in Malawi, Botswana, Zambia and Zimbabwe and as Capital Bank in Mozambique.

The banking group, which was founded in Malawi in 1995 as First Merchant Bank, has a staff complement in excess of 1,800 people and assets in excess of $1.1 billion.

During the firm’s annual general meeting in Blantyre in June 2018, shareholders authorised directors to issue for cash, in accordance with rules 5.84 to 5.92 of the listings requirements of MSE, new ordinary shares up to a maximum of 10 percent of the issued ordinary shares of the company.

Before passing the resolution, minority shareholders questioned whether the move would not weigh down the price of their stocks. They also wanted to find out who would buy the new shares.

But FMBCH Chairperson, Terence Davidson, assured the shareholders that the move would not have a significant impact on share price.

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