POSB seeks strategic investor
The planned partial privatisation of People’s Own Savings Bank (POSB) is gaining momentum as the bank is now seeking a strategic investor to acquire up to 29 percent shareholding.
Partial privatisation is set to be completed by the end of this year, with the bank now in the process of completing outstanding deliverables.
Among the expected deliverables is a request by the Government for details of the strategic partner whose identity the bank will reveal next year.
The Government, which wholly owns the bank, plans to partially privatise POSB as part of its extensive overhaul of the under-performing public enterprise sector.
Under the reforms, most of the parastatals will either be privatised or capitalised to be able to perform better and reduce their reliance on State bailouts.
The partial privatisation of the POSB will involve the Government offloading a minority stake and using the proceeds, in part, to capitalise the bank.
In a notice seeking expressions of interest, the bank said: “The Government of Zimbabwe intends to engage a strategic investor in a partial privatisation of the People’s Own Savings Bank, a savings bank licensed and supervised by the Reserve Bank of Zimbabwe, by offering up to 29 percent available shareholding through the private placement of the Bank’s equity share capital.
“The private placement will be followed by an initial public offering (IPO) of up to 20 percent shareholding of the Bank to diversify the shareholder base and improve liquidity of the shares.
“Accordingly, the Government of Zimbabwe will hold 51 percent equity stake post the partial privatisation as provided in the People’s Own Savings Bank Act,” reads part of the notice.
KPMG Advisory Private Limited are the financial transaction advisors for the engagement of a strategic investor.
KPMG Advisory Private Limited
Interested parties have up to October 13 to submit documents.
According to the expressions of interest document, interested parties are required to provide a description of the acquiring entity or vehicle with evidence of registration or incorporation, ownership of the acquiring entity or vehicle and identify all shareholders with a five percent or more stake.
Prospective investors should also detail the strategic rationale for the investment in POSB, provide relevant financial services industry experience or demonstrable evidence of ability to manage a bank of POSB nature.
Following the evaluation of the expressions of interest, a shortlist of potential investors, who in the Ministry of Finance and Economic Development view are deemed to be fit and suitable will proceed to the first phase of the transaction. Shortlisted investors will be contacted and advised on next steps.
After strategy advisor KPMG submitted the privatisation roadmap document to Finance and Economic Development Minister Professor Mthuli Ncube in 2022, the minister requested a more comprehensive document that is inclusive of the recommended strategic partner.
Finance and Economic Development Minister Professor Mthuli Ncube
POSB has been in the market for potential suitors for some time as part of the 15 parastatals earmarked for privatisation under different models by the Government.
Other parastatals designated for privatisation include perennial loss-making national carrier Air Zimbabwe, Agribank, TelOne, and NetOne.
POSB is a financial services provider that is wholly owned by the Government of Zimbabwe and was established in terms of the People’s Own Savings Bank of Zimbabwe Act of 1999.
The Government says it has made steady progress on the parastatal reform programme, undertaken since 2018, meant to improve public service delivery, enhance their contribution to the overall economy and create employment.
The reform framework, which is also part of the broader National Development Strategy 1 (NDS1), seeks among other reasons, to mobilise private sector capital, technology, and expertise to enhance efficiency and the effectiveness of public entities in the delivery of goods and services.-chronicle
