Johannesburg - South African lender African Bank Investments aims to keep the financing arm of its Ellerines unit, its chief financial officer said on Monday, after putting the retailer up for sale last month.
Abil, as the bank is called, said last month it would sell Ellerines, a furniture retailer it bought five years ago to help it extend more loans to low-income customers by selling beds and sofas on credit.
“We would want to keep the credit piece because that is what we bought Ellerines for and in trying to sell or negotiating a sale, that will be our starting point,” Nithia Nalliah told Reuters.
“But if a prospective buyer wants that with some form of credit, or part of the credit, we clearly will be negotiating.”
The lender had received many inquiries but was not in any discussions for a purchase yet, he said.
Nalliah spoke after shareholders approved a rights issue to raise up to 4 billion rand ($403 million) to shore up the bank's capital. The bank is yet to price the issue, which is fully underwritten by Goldman Sachs.
Abil, which specialises in lending without collateral, has been on the back foot as South African borrowers struggle to meet their obligations. Its share price has fallen 50 percent so far this year. - Reuters