HSBC will buy up to 70% of South Africa's Nedbank, in a potential $6.8 billion deal that would give Europe's largest lender a presence in Africa's largest economy and a gateway to the fast-growing continent.
HSBC and Anglo-South African insurer Old Mutual, which owns a controlling stake in Nedbank, said in separate statements today they were in exclusive talks about the deal.
Old Mutual said HSBC could acquire up to 70% of South Africa's fourth-largest bank, a deal that could be worth about 49.9 billion rand ($6.84 billion), given Nedbank's current market value.
Old Mutual is undergoing a strategic overhaul to slim down its complicated structure.
Nedbank said in a statement that HSBC was an attractive international banking partner. This month it posted flat first-half earnings and said it would struggle to meet its medium-term forecasts, hurt by its money-losing retail unit.
Meanwhile, the Financial Times newspaper reported today that HSBC had fended off competition for Nedbank from British-based emerging markets lender Standard Chartered.
The daily business newspaper, which cited people familiar with the talks, added that HSBC's proposed Nedbank deal could lead to a full takeover offer.
HSBC had agreed last month to buy the Indian commercial and retail banking assets of Britain's state-controlled Royal Bank of Scotland.
