Stanbic Bank Botswana is offering investors a 20% stake worth P1.37 billion ($99.2 million) as its parent shareholder moves to expand local ownership and secure the bank’s admission to the Botswana Stock Exchange (BSE).

The offer values the lender at approximately P6.87 billion($497.4 million), based on a price of P4.30 ($0.31) per share. Up to 319.36 million existing shares will be made available to investors, giving Botswana’s institutional and retail investors an opportunity to acquire equity in one of the country’s established commercial banks.

The transaction also marks a partial exit by Stanbic Africa Holdings Limited, a wholly owned subsidiary of South Africa’s Standard Bank Group, which is selling part of its existing investment while retaining majority control of the Botswana lender.

Institutional investors dominate the $99.2 million offer

The share sale is structured to attract both institutional and individual investors, although most of the shares have been reserved for selected institutional buyers. Of the 319.36 million shares on offer, 255.49 million shares, representing 80% of the transaction, will be allocated through a private placement to institutional investors. The remaining 63.87 million shares will be available through a public offer.

At the offer price of P4.30 ($0.31) per share, the private placement is valued at approximately P1.10 billion ($79.72 million), while the public portion is worth P274.65 million($19.9 million).

Institutional demand appears substantial ahead of the listing. According to the abridged prospectus published on October 29, the bookrunner has received irrevocable undertakings from institutional investors for up to 767.95 million offer shares, equivalent to 240% of the total shares available.

However, final allocations will depend on the outcome of the offer process. The public offer opens on October 30 at 09:00 and closes on November 27 at 16:30, Botswana time. Results are expected on December 4, with trading scheduled to begin on December 7, subject to regulatory approvals and listing requirements.

Standard Bank retains 80% ownership

Following the transaction, Stanbic Africa Holdings will retain an 80% interest in Stanbic Bank Botswana, while institutional investors will own 16% and public shareholders will hold the remaining 4%.

The Botswana Stock Exchange has approved a 20% free float for the listing. To manage the transition in ownership, Stanbic Africa Holdings will lock up 75% of its retained shares from the listing date. Half of the locked-up shares will become available after 12 months, with the remainder released after 24 months.

Importantly, the transaction will not inject fresh capital into Stanbic Bank Botswana. Because all the shares being sold are existing shares held by Stanbic Africa Holdings, the bank will receive no proceeds from the P1.37 billion ($99.2 million) offer. Instead, the listing is designed to broaden the bank’s shareholder base, increase domestic ownership and satisfy the public shareholding requirements for admission to the BSE Main Board.

What investors need to know before applying

At P4.30 ($0.31) per share, the proposed valuation of P6.87 billion ($497.4 million) gives investors a reference point for assessing the bank’s earnings, assets, financial risks and future growth prospects.

The prospectus identifies several risks, including Botswana’s economic conditions, credit quality, liquidity, technology and cybersecurity threats, regulatory changes and the bank’s franchise agreement with Standard Bank Group.

Investors must apply for a minimum of 250 shares, with additional applications accepted in multiples of 10. Applications must be fully paid in Botswana pula, and successful applicants must hold a Central Securities Depository Company of Botswana account through which their shares will be registered.

For Standard Bank Group, the transaction provides an opportunity to unlock part of its investment while maintaining an 80% controlling interest. For Botswana’s capital market, it introduces a major commercial bank to the local exchange and creates another avenue for domestic investors to participate in the country’s banking sector.