Dangote Group acquires substantial stake in Afreximbank

Dangote Group, Africa’s leading indigenous conglomerate, with footprints in 17 countries, has acquired substantial equity stake in African Export-Import Bank (Afreximbank), thereby becoming a class ‘B’ shareholder of the pan-African trade bank.

The class ‘B’ shareholders are made up of African financial institutions and African private investors.

Information released by Afreximbank seen by BusinessDay shows that the Dangote Group completed the process of acquiring equity in the bank on May 30, 2016, with a “substantial investment.”

“I consider Afreximbank a good vehicle for fostering regional integration in Africa, which aligns with our vision and mission for growth and development across the continent,” Aliko Dangote, president/CEO of Dangote Group, said.

According to Obi Emekekwue of Afreximbank external communications department, the president of bank, Benedict Oramah, welcomed the action by the Dangote Group, saying the investment is “a strong vote of confidence in the bank by, arguably, the largest indigenous corporate in Africa.”

“The massive investments the Group is making across Africa make it a partner of choice in the delivery of our Intra African Trade Strategy,” Oramah said.

Oramah said, “Working with the Dangote Group, we will build supply chain financing across Africa that could reach $1 billion in the short term, promoting intra-regional trade and growth of SMEs and creating much needed jobs.”

Afreximbank, a foremost pan-African multilateral financial institution devoted to financing and promoting intra- and extra-African trade, was established in October 1993 by African governments, African private and institutional investors, and non-African investors. It has total assets of $9.4 billion as of April 30,2016, and is rated BBB- (Fitch) and Baa2 (Moody’s).

The bank, headquartered in Cairo, Egypt, has four classes of shareholders, divided into classes A, B, C and D, which are made up of a mix of African governments, central banks, regional and sub-regional institutions, African private investors, African and non-African financial institutions, export credit agencies and non-African private investors.

Class ‘A’ shareholders are African states, African central banks and African public institutions, including the African Development Bank (AfDB), while class ‘B’ is made up of African financial institutions and African private investors.

Class ‘C’ shares are held by non-African investors, mostly international banks and export credit agencies, including Standard Chartered Bank, HSBC, Citibank, China Exim Bank and Exim India. Class ‘D’ shares, a tier approved in December 2012, are fully paid par value shares that can be held by any investor.

Since 1994, Afreximbank has approved more than $41 billion in credit facilities for African businesses, including about $6.2 billion in 2015.

 

BEN EGUZOZIE, with wire report