Capitec gets final go-ahead for Mercantile


Capitec gets final go-ahead for Mercantile

Published Date: 2019-10-10 | Source: Stephen Gunnion | Author: Stephen Gunnion

Capitec gets final go-ahead for Mercantile

The bank will use Mercantile as a springboard into business banking as it targets the SME market.

Capitec has cleared the final hurdle in its takeover of Mercantile Bank after receiving all required regulatory approvals for the acquisition.

It won the bid to buy Mercantile last November after beating Nedbank and a consortium led by the Public Investment Corporation, amongst a number of others, with its R3.2 billion offer. The final purchase price, adjusted to reflect the change in Mercantile's net asset value between April 2018 and this August, will be communicated later this month following a final review.

It will use Mercantile as the foundation for a no-frills, digitally-led business offering that will target the SME market. Buying Mercantile removes the need to reinvent and create new systems and processes from scratch, fast-tracking its broader bank strategy. It will retain the Mercantile brand for at least the short term.

Mercantile was put up for sale by Portuguese lender Caixa Geral de Depositos as it divested of non-core operations in order to meet European capital requirements. Mercantile banks small- to medium-sized businesses and its customers include about 12,000 entrepreneurs.

Capitec's shares declined by 0.2% to R1,336.03 yesterday.

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