Business
South African companies’ investments in other African countries paying off
Ramos said recently when releasing results that she wanted to see her bank become one of the top three banks by revenue in South Africa, Ghana, Kenya, Botswana and Zambia. Although the group was always on the prowl for acquisitions in other markets, Barclays Africa would focus on growth in the markets it was already in.
Korner Perspectives MD Graeme Korner said that after a series of own-goals the Africa expansion of Ramos’s company seems to be working. Korner did not think Ramos overpaid for the Barclays operations, and said that FirstRand would probably have paid more for a decent footprint in eight African countries.
FirstRand has been knocking on a number of doors, but most of the deals it has tried to bed down have been unsuccessful. Failed deals include those involving Nigeria’s Sterling Bank, Merchant of Ghana, and Zambia’s Finance Bank. However, the head of the group Sizwe Nxasana said at the release of the group’s results this month that he was not frustrated because the group’s organic approach enabled it to fuse its culture wherever it expanded on the continent and protected shareholder returns by having control over the operations.
Nxasana is aware that organic growth is a lengthy process but is “quite happy with it”. When pressed on whether FirstRand is not being left behind in the rush for Africa, he said: “We are playing a different game. We are not playing our competitors’ game. If some of them want to plant flags in all the 54 countries … if they want to grow branches in every corner of every country, that is not where we are.”
FirstRand has operations in Mozambique, Zambia, Tanzania, Nigeria, Ghana and India. FirstRand still has an eye open for acquisition opportunities, but does not have a team actively searching for prey, according to Nxasana.
Copyright Business Day Live 2014
