MAURITIUS-based AfrAsia Bank, which recently acquired 35 percent of Kingdom Financial Holdings Limited, has
raised US$16,5 million for further expansion into the Sadc and Comesa regions with particular focus on Zimbabwe and Malawi.
AfrAsia Bank has also sold options to a major European private equity fund, giving the fund the right to subscribe for an additional US$10,4 million of equity before May 31 2012.
The new addition to AfrAsia's tier 1 capital base takes the bank's regulatory capital to nearly U$69,4 million.
The capital was raised from existing shareholders and new institutional and high net worth investors.
AfrAsia, a boutique bank with a mission to grow African and Asian business
links, already has South African representation in Johannesburg, Cape Town and Durban.
In a statement, chief executive officer Mr James Benoit said the inflow of new tier 1 capital was an expression of confidence in AfrAsia's vision, strategies and growth prospects.
"The main aim of the capital raising was to fund continued growth in Mauritius and Africa.
"A mix of acquisitive and organic growth is envisaged," he said.
In line with its expansion strategy, Afr- Asia announced the purchase of a 35 percent stake in KFHL for US$9,5 million.
KFHL has interests in the banking, stockbroking and asset management sectors in Zimbabwe and Malawi.
"KFHL is a profitable financial services group in the high growth Southern African market.
"The transaction is value-enhancing and provides us with a unique opportunity
to expand our franchise in the Sadc region through an established local operation
and with highly credible local partners,"
said AfrAsia chairman Mr Arnaud
Founder and anchor shareholder of Kingdom Mr Nigel Chanakira said: "This transaction will open new channels of much needed capital, lines of credit and deal flow for our loyal client base. I am excited about the prospects."
Kamben Padayachy, AfrAsia general manager and Head of Global Banking, Treasury and Markets added: "This exceptional investment opportunity has the potential for high rewards in a largely undeveloped market.
"The proposed transaction structure will enable AfrAsia to mitigate inherent risks to ensure the full benefits of the transaction are realised."
AfrAsia Corporate Finance acted as exclusive arranger for the capital raising and as sole transaction adviser to AfrAsia and co-adviser to KFHL on the KFHL investment.
Cosmos Capital was co-adviser to KFHL on the investment.