Capricorn Investment Holdings (CIH) has disposed of its 32 percent shareholding in trade union-backed, Nam-mic Financial Services Holdings (NFSH), in a deal worth in excess of N$370 million, the Windhoek Observer has established.
CIH is the biggest shareholder in Namibia Stock Exchange listed, Capricorn Group, which in turn has a 100 percent stake in Namibia’s largest locally owned bank and second largest lender, Bank Windhoek.
Capricorn Group’s Company Secretary, Hellmut von Ludwiger, told the Windhoek Observer upon enquiry that the decision by CIH to exit Nam-mic Financial Services Holdings was “mutual”.
He said the initiative for the disposal came from CIH to solve Capricorn Group’s “public float” requirement.
“The decision was mutual…Being a listed company, at least 20 percent of the shares should be held by the public and ‘public’ by definition excludes shareholders holding in excess of 10 percent,” von Ludwiger told the Windhoek Observer.
According to details of the deal, NFSH agreed to buy back the shares held by CIH in return for a combination of cash and Capricorn Group shares in the deal worth in excess of N$370 million.
This comes after CIH in 2003 facilitated NFSH’s acquisition of a 7.5 percent stake in Capricorn Group (previously called Bank Windhoek Holdings), after its trade union shareholders could not contribute sufficient capital to conclude the transaction. In exchange, CIH became a 27 percent shareholder in NFSH.
“NFSH remains a strategic empowerment partner for Bank Windhoek and Capricorn Group, and co-operation continues at various levels,” von Ludwiger said when quizzed about the group’s BEE status.
He maintained NFSH will continue with its partnership with Bank Windhoek in selling micro-loans and NFSH remains a significant shareholder at 8% in Capricorn Group.
“Nam-mic Financial Solutions (a subsidiary of NFSH) continues to sell Nam-mic microloans that are provided by BW Finance (Pty) Ltd (a subsidiary of Bank Windhoek),” he said.
Von Ludwiger quashed rumors that CIH disposed of its shareholding in NFSH after its subsidiary, the Capricorn Group, acquired a controlling 55.5 percent stake in micro-lender, Entrepo, last year, a business offering services similar to NFS.
“No. The operations of Nam-mic/BW Finance and Entrepo are completely separate, and there is no intention to change that. The majority of Nam-mic microloans are granted to employees in the private sector, while Entrepo exclusively serves government employees,” he said.
NFSH CEO, Walter Don, also downplayed the impact of Capricorn Group’s entry into the microlending business through Entrepo.
“The Entrepo/Capricorn Group deal will not affect our existing loan offering to our clients, “he said.
Don said NFSH had not made any profit from the disposal by CIH.
“No profit was made. It was just restructuring of shareholding that took place,” he said.
NFSH is a broad-based black economic empowerment company, now 100 percent owned by unions affiliated to the National Union of Namibian Workers (NUNW) and now owned 51.1 percent by Nam-mic Holdings.
Effort Investment Holdings Company holds a further 29.6 percent, Nafau Investment Holdings 9.8 percent, Namibia National Teachers Union 7.5 percent, Zealot Investment 1.6 percent and Namibia Farm Workers Union 0.4 percent.
NFSH also has stakes in Capricorn Group associate companies Santam Namibia (12 percent) and Sanlam Namibia (16.4 percent).