South Africa's African Bank Investments plans variable-rate preferreds

By Angela McDaniels

Tacoma, Wash., July 1 - African Bank Investments Ltd. plans to issue variable-rate perpetual non-cumulative preference shares by way of a private placement, according to a company news release.

The price will be 7,916 cents per preference share, which is a 3.82% discount to the 10-day volume-weighted average trading price as of the close of business on Wednesday. The bank said this results in an effective yield of 87.2% of prime.

The offer period will begin July 15 and close July 19. The settlement date is expected to be July 26.

After including accrued dividends, the issue price for settlement on July 26 will be 7,975 cents.

The minimum subscription amount will be ZAR 100,000 per principal institutional investor and ZAR 1 million per principal non-institutional investor.

ABSA Capital (011 895 5382) and Investec Capital Markets (011 286 9930) are the bookrunners. Interested investors are asked to contact them for information on the placement process.

The bank plans to use the proceeds to subscribe for ordinary shares in its wholly owned subsidiary African Bank Ltd.

The issue is subject to the approval of the listing of the preference shares by the Johannesburg Stock Exchange.

The issuer is based in Midran, South Africa.

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