FirstRand borrows R173m from IFC
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THE International Finance Corporation (IFC), the private sector arm of the World Bank, will lend FirstRand R173m for black economic empowerment, the group said yesterday.
The funding is part of plans by FirstRand, one of SA’s big four banking groups, to sell a 10% stake to black investors for R7,9bn in one of the country’s biggest empowerment deals.
Under the IFC agreement, FirstRand Empowerment Trust would buy 363,8-million ordinary shares in the bank and hold them for four black empowerment groups — Kagiso Trust, Mineworkers Investment Trust, FirstRand Empowerment Foundation and WDB Trust.
The IFC described the funding as a mezzanine loan, but gave no further details.
“We expect this transaction to have a high developmental impact, as it will help one of SA’s largest financial services groups better include previously disadvantaged groups in its ownership and operations,” said IFC Africa director Richard Ranken.
More than a decade after apartheid, most of the continent’s biggest economy is still controlled by whites.
Companies are working to meet criteria on black ownership, employment and procurement.
FirstRand shares closed 1,42% up at R14,25 yesterday on the JSE Securities Exchange SA. Reuters
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