Republic Bank intends to formally make mandatory offer to the shareholders of HFC Bank in Ghana, Ghana News has reported.
The bank’s annoucement was contained in a circular issued by the Ghana Stock Exchange on Thursday.
If the offer is successful, it could lead to Republic Bank becoming the majority shareholder of HFC Bank and possibly take over the institution.
Republic this week received approval from the Bank of Ghana to go ahead with the move.
Last year, Republic acquired 40 per cent of HFC. By Ghanaian law the bank is mandated to make an offer for the outstanding shares.
In June the bank had requested a waiver from Ghana’s Security and Exchange Commission for the Code on Take Overs and Mergers, but was denied. The SEC advised Republic that it must comply with the mandatory takeover requirements and make an offer for remaining shareholding in HFC Bank Ghana Ltd, the Bank had said in a statement last June.
Ghana News reported an executive director of HFC nominated by Republic said the bank did not want to rush the takeover, since the bank still wanted to get a deeper understanding of the Ghanaian market.
In a brief telephone interview with the Express yesterday, Republic’s managing director David Dulal-Whiteway said this is just an announcement of the bank’s approval and intention to make the offer, but Republic was still working out the logistics and paperwork. He added that based on the shareholder structure of the bank, he did not think Republic would acquire total shareholdings.
He said the bank was “very positive” about its move into the Ghanaian market, adding that he will be in Ghana all week, next week.
Responding to why Republic chose Ghana as an investment, Dulal-Whiteway said in looking at its opportunities to grow outside the region, Commonwealth Africa seemed to be the best option, with the Ghanaian economy doing well, growing significantly over the last decade.
“It’s a very attractive economy, (and we felt their growth is) something we can experience in the Caribbean. We at Republic have the capital and the financial and human resources to add value (to HFC),” he said.
Republic Bank is the largest indigenous financial institution in the Caribbean, with an asset base of over $50 billion.