‘Nothing new’ in Nedbank takeover talk

7/9/2010 12:40:04 PM

SURE KAMHUNGA

Financial Services Editor

Just when Nedbank thought it had heard the last of unwanted suitors keen to prise it away from majority shareholder Old Mutual, it was forced yesterday to respond to reports that yet another was making a bid for it.

Sky News yesterday reported that HSBC — Europe’s largest bank — was evaluating a bid for Nedbank, the smallest of SA’s big four banks by market capitalisation. The latest speculation came after a recent report that Standard Chartered Bank, which derives up to 90% of its annual profit from emerging markets, was also keen to buy Nedbank as part of plans to expand in Africa, where it operates in several countries.

Nedbank is reportedly worth up to $10bn, but an analyst yesterday dismissed the latest reported bid as mere speculation, “probably by someone naughty wanting to drive up the (share) price”.

Even as Nedbank’s share price yesterday morning responded by jumping as much as 3,1%, CEO Mike Brown told Business Day there was nothing new to the speculation. He said he would rather have Old Mutual comment on whether Nedbank was for sale. Old Mutual has a policy of not responding to market speculation, although group CEO Julian Roberts has previously laughed off such reports.

“This kind of speculation has been raised on numerous occasions over the years, so is not really new and should really be referred to Old Mutual as the majority shareholder of Nedbank,” Mr Brown said.

HSBC is believed to be keen to use SA as a launch-pad into Africa, where its rival, Industrial and Commercial Bank of China, has gained a foothold through its 20% stake in Standard Bank, Africa’s largest bank by assets.

The banking analyst said it would make sense for Old Mutual to partner with Nedbank to expand into Africa rather than sell the bank, or pursue expansion separately. Nedbank has already confirmed that it was interested in expanding in Nigeria in partnership with that country’s Ecobank, with which it established a strategic alliance two years ago.

Nedbank shares closed yesterday 3,88% higher at R132,05.

kamhungas@bdfm.co.za

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