CAPITEC BANK HOLDINGS LIMITED - Acquisition Of Mercantile Bank Holdings Limited And Its Subsidiaries

Acquisition Of Mercantile Bank Holdings Limited And Its Subsidiaries

Capitec Bank Holdings Limited
Registration number 1999/025903/06
Registered bank controlling company
Incorporated in the Republic of South Africa
JSE ordinary share code: CPI ISIN code: ZAE000035861
JSE preference share code: CPIP ISIN code: ZAE000083838
("Capitec" or "the company")

Capitec Bank Limited
Incorporated in the Republic of South Africa
Registration No. 1980/003695/06
Company code: BICAP
Stock Code: CBL13
ISIN Code: ZAG000092560
Stock Code: CBL14
ISIN Code: ZAG000092552
Stock Code: CBL17
ISIN Code: ZAG000099359
Stock Code: CBL18
ISIN Code: ZAG000099367
Stock Code: CBL20
ISIN Code: ZAG000102245
Stock Code: CBL22
ISIN Code: ZAG000105305
Stock Code: CBL24
ISIN Code: ZAG000130881
Stock Code: CBL25
ISIN Code: ZAG000136110
Stock Code: CBL26
ISIN Code: ZAG000136128
Stock Code: CBL27
ISIN Code: ZAG000143884
Stock Code: CBL28
ISIN Code: ZAG000151333
(“Capitec Bank” or “the bank”)

ACQUISITION OF MERCANTILE BANK HOLDINGS LIMITED AND ITS
SUBSIDIARIES (“MERCANTILE”)

Shareholders are referred to the SENS announcement dated 18
June 2018 that Capitec Bank, the wholly-owned subsidiary of
Capitec, made a non-binding offer to purchase Mercantile. A
further notification, included in Capitec’s interim results
published on SENS on 26 September 2018, stated that Capitec
Bank submitted a formal bid on 31 August 2018 to acquire
Mercantile. The offer was made subsequent to the conclusion of
a detailed due diligence on the operations of Mercantile.

The Board is pleased to advise shareholders that Capitec
Bank’s offer of R3.2 billion, to be adjusted by any change in
the net asset value of Mercantile from 30 April 2018 to the
completion date of the transaction, when all conditions
precedent have been met, has been accepted. The purchase
consideration will be paid from capital and cash reserves.

The Board of Capitec Bank believes there are many
opportunities in the market to serve small-to-medium
enterprises and owner-managed businesses better, and the bank
has commenced with a strategy to develop infrastructure to
facilitate same. The acquisition of Mercantile will obviate
the need to reinvent and create new systems and processes from
scratch and thus fast track the bank’s objective to expand its
focus to a broader bank strategy.

Mercantile’s core business offer is business banking for
small- to medium-sized enterprises and entrepreneurs and it is
therefore well positioned to align with Capitec Bank’s
business banking strategy. It was offered for sale by its
shareholder, Caixa Geral de Depósitos S.A., a Portuguese bank,
because it is divesting from non-core operations outside of
Portugal as part of its recapitalisation plan.

The transaction is subject to regulatory authority.
Shareholders will be informed once all regulatory approvals
have been received and the transaction is final.


22 November 2018
Stellenbosch

Sponsor PSG Capital

Date: 22/11/2018 04:12:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.