South Africa’s FirstRand is drawing interest from global private-equity firms as it prepares to sell UK lender Aldermore Bank, with CVC Capital Partners expected to join a growing list of potential bidders.

CVC prepares Aldermore offer

CVC has been laying the groundwork for a potential offer for months and is expected to submit a takeover proposal before a September deadline, according to people familiar with the process.

FirstRand said in April it plans to exit Aldermore after provisions linked to a UK motor finance mis-selling scandal rose to £750 million ($997.2 million). The sale would mark a significant shift in the South African banking group’s international strategy.

FirstRand acquired Aldermore for £1.1 billion ($1.45 billion) in 2017 as it sought to diversify earnings beyond South Africa and expand its specialist-lending business. Aldermore provides residential mortgages, business lending and other specialist financial products in the UK.

Metro bank, Lloyds among potential bidders

Metro Bank is also considering an offer, with a potential transaction previously reported at about £2 billion ($2.7 billion). Lloyds Banking Group and Shawbrook have also emerged as possible interested parties.

Any buyer is likely to seek protection against future compensation liabilities linked to the motor finance scandal. Bank of America and Rand Merchant Bank are advising FirstRand on the sale.

Bankers are expected to give bidders the option of making separate offers for Aldermore’s banking operations and MotoNovo, its motor finance arm.

FirstRand weighs UK exit

Founded in 1998, FirstRand has grown into one of Africa’s leading financial services groups, with businesses including FNB, RMB, WesBank and Aldermore. It serves retail, commercial and corporate customers across banking, lending and investment services.

FirstRand is listed on the Johannesburg Stock Exchange and Namibian Stock Exchange and is Africa’s largest financial institution by market capitalization. Its model allows the group to use different brands, distribution channels, licenses and operating platforms across its portfolio.

CVC targets another financial asset

CVC Capital Partners is a global private markets manager focused on private equity, secondaries, credit and infrastructure. The firm has a network of 30 local offices and €212 billion ($247 billion) in assets under management.

CVC Capital Partners plc is publicly listed on Euronext Amsterdam and operates seven complementary investment strategies across private equity, secondaries, credit and infrastructure.