Standard Bank Group and the Industrial and Commercial Bank of China (ICBC) have agreed to terms that will see the later acquire a controlling interest in former’s London-based Global Markets business for an estimated $765 million.
Under the agreement, ICBC will acquire 60 percent of Standard Bank Plc, the Group’s UK subsidiary and the primary legal entity used by this business, and its other international operations.
This stake in the Global Markets business includes commodities, fixed income, currencies, credit and equities products, and operations in New York, Dubai, Singapore, Shanghai, Hong Kong and Tokyo.
However it excludes Standard Bank’s other activities conducted outside Africa, comprising Investment Banking, Transactional Products and Services and Corporate Banking and Services Unit. All Off-shore businesses are also not part of the deal.
The deal is comprised of pre-determined portion as 60 percent of the audited net asset value of Standard Bank Plc at the completion date of the transaction less $80 million. Based on the net asset value of Standard Bank Plc and other relevant operations as at the end of June 2013, the consideration for this transaction is estimated to be $765 million.
It further grants ICBC a five-year option to purchase a further 20 percent of the outstanding ordinary shares of Standard Bank Plc.
This transaction now firmly gives the ICBC a greater footprint not only in the Standard Bank Plc, but in the financial centre of Europe, being London.