July 12 (Bloomberg) -- FirstRand Ltd. said talks to buy Merchant Bank Ghana failed, setting back the efforts of South Africa’s second-largest financial services company to build a presence in West Africa.
“Despite all reasonable endeavors, the parties were unable to reach agreement on the commercial principles underlying the transaction,” Sam Moss, investor relations director of Johannesburg-based FirstRand, said in an e-mailed statement today. “The transaction cannot be completed and has lapsed.”
The failure of the negotiations with the Ghanaian bank come after FirstRand ended talks to buy Nigeria’s Sterling Bank Plc in 2011 as the parties were unable to agree on terms. FirstRand offered to buy 75 percent of Merchant Bank Ghana for about 750 million rand ($74.7 million) last year after Chief Executive Officer Sizwe Nxasana said in 2010 that the South African lender intended to enter Nigeria and Ghana.
Ghana’s Social Security and National Insurance Trust will invite new proposals from parties interested in buying Merchant Bank, Moss said. “Ghana remains a priority country for expansion and the group would continue to engage with SSNIT on its new process,” she said.
FirstRand gained 0.9 percent to 28.80 rand at 11:27 a.m. in Johannesburg.
FirstRand opened an investment banking unit in Nigeria’s commercial capital, Lagos, in 2012.
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