Capitec Bank Shares Slump After Investor’s Discounted Sale

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Capitec Bank Holdings Ltd. shares fell as much as 5.9 percent after Investec Ltd. sold a stake in the lender on behalf of Africa’s biggest fund administrator at less than the last closing price.

Investec managed the sale of 3.7 million shares at 505 rand each Tuesday in a transaction valued at 1.87 billion rand ($156 million), the Johannesburg-based bank said in an e-mailed statement. The offer was “well oversubscribed,” it said. The price is 6.5 percent below Tuesday’s close for Capitec, based in Stellenbosch, near Cape Town.

Investec was acting on behalf of the Public Investment Corp.’s Isibaya Fund, Capitec said. Isibaya was set up to invest in projects that support development in South Africa and held 5.2 million Capitec shares since February 2012. It was classified as a black investor, helping the bank meet black ownership targets set by the government to try and make up for discrimination during apartheid. Investec sold the shares to other black investors.

“The Isibaya Fund independently made an agreement with another black consortium who acquired the shares in a structure facilitated by Investec,” Charl Nel, a spokesman for Capitec, said in an e-mailed statement Tuesday, without identifying the lender’s new shareholders. “The bank welcomes the transaction as it enhances our black economic empowerment status.”

Capitec, which provides unsecured loans, declined 3.7 percent to 520 rand at 10:59 a.m. in Johannesburg, paring its gain in the past six months to 85 percent. The shares earlier fell as low as 508 rand.

(Updates with Capitec comment in fourth paragraph.)
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