From Imara Holdings:
Botswana-registered Imara Holdings Limited (IHL) has announced the planned sale of one of its Johannesburg subsidiaries, the stockbroker Imara S.P. Reid (Pty) Ltd (ISPR).
The envisaged disposal to MMI Strategic Investments Proprietary Limited (MMI) is expected to realise R120 million (approximately BWP100 million).
Details of the transaction, along with statutory information on IHL and notice of an extraordinary general meeting will be published in a circular to shareholders in January 2015, said Imara Group CEO Mark Tunmer.
He noted: “Historically, ISPR has been an important contributor to the Imara Group. However, an increase in online share trading, escalating regulatory and compliance costs and generally changing market dynamics have led to growing pressure and competition and ultimately to a change in the Group’s strategic investment objectives. In response, several options were considered – principally, to invest further capital in the business or to pursue opportunities to exit the business.
“ISPR is an attractive investment within South Africa’s stockbroking industry and the IHL board considered several proposals from potential buyers.
“The purchase consideration to be received from MMI represents a premium to the current net asset value of ISPR. The board therefore believes a disposal under these terms is in the best interests of Imara
Tunmer said Imara would retain a strong position in the South African market in areas of key focus. The pan-African Imara financial services group has on-the-ground representation across sub-Saharan Africa, either directly or via associates.
Tunmer added: “The envisaged transaction bestows benefits on all parties. It permits MMI to take an established position in South Africa’s retail stockbroking market, creates potential for ISPR to further strengthen its position in this sector and enables Imara to pursue further growth in our focus areas.
“We are confident the transaction will also prove beneficial for ISPR clients and staff.”
Finalisation of the transaction is dependent on regulatory approval and the approval of Imara shareholders at an extraordinary general meeting.
IHL has operated under a cautionary notice since mid-September. The IHL board advises shareholders to continue to exercise caution in any share dealings.
Imara S.P. Reid – established in 1938 – is one of South Africa’s oldest stockbrokers.
