South African billionaire Patrice Motsepe has acquired 90 percent of South Africa’s technology-focused bank, TymeDigital Bank from Commonwealth Bank of Australia, through his investment holding company African Rainbow Capital (ARC).
Motsepe’s ARC, which acquired 10 percent of TymeDigital Bank last year, increased its stake in the company by 90 percent for an undisclosed amount.
ARC which offers financial services, industry and healthcare and insurance businesses stated that buying the newly registered TymeDigital is subject to approval from the Reserve Bank and competition authorities.
In July, Commonwealth Bank of Australia (CBA) disclosed plans to pull in its investments in other markets to focus on Australia and New Zealand. This led it to sell off low earning fintech business TymeDigital, which was issued an operating licence by the South African Reserve Bank (SARB) last year. The plan is to launch a full service digital bank and disrupt banking in South Africa.
According to CBA’s 2018 financial results for 2018, TymeDigital posted a net loss of A$78 million ($57.8 million) for the financial year and its non current assets have been impaired by A$91 million ($67.5 million).
A significant portion of CBA’s write-offs have been attributed to TymeDigital. The largest being links to TymeDigitals A$55 million ($40.8 million) launch in South Africa.
Meanwhile, African Rainbow Capital on Wednesday stated that after acquisitions are finalized, the company may consider introducing new shareholders and management in the current structure.
What you should know about African Rainbow Capital
Patrice Motsepe owns ARC Investment’s 51.7 percent listed entity, which in turn is 100 percent owned by a broad-based black economic empowerment entity, Ubuntu-Botho Investments (UBI).
Motsepe’s African Rainbow Capital which has its headquarters in Mauritius owns shares in a number of financial services businesses, including Alexander Forbes and A2X Markets.