Discovery: Bank working on BEE deal

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Independent Newspapers.

Discovery chief executive Adrian Gore. Photo: Simphiwe Mbokazi.

Johannesburg - Discovery Ltd. said Standard Bank Group Ltd. is working with a black investor on the sale of about 2 percent of South Africa’s largest medical-insurance administrator.

“Standard Bank is working with a black economic empowerment party on a transaction,” Richard Farber, financial director of Johannesburg-based Discovery, said in an e-mailed response to questions today.

“A detailed announcement will follow in due course.”

The stake is worth about 1.15 billion rand ($110 million), Jhulan Vallabh, part of Standard Bank’s equity capital markets team, said in a phone interview from Johannesburg.

Vallabh declined to name the bank’s client, adding that the shares aren’t being sold by Discovery chief executive Adrian Gore.

“They are going at a discount,” Vallabh said.

“We are looking to close the books today.”

Discovery’s three biggest shareholders are Rand Merchant Insurance Holdings Ltd., South Africa’s Government Employees Pension Fund and Gore, according to Discovery’s latest annual report.

South African companies are compelled by law to increase ownership by black shareholders to make up for discrimination under apartheid.

Discovery fell 1.3 percent to 78.79 rand as of 12 p.m. in Johannesburg trading, its lowest level in almost two months.

That cut the company’s market value to 46.6 billion rand. - Bloomberg News

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