BOP given go ahead to up stake in Bona Life
Botswana Opportunities Partnership (BOP) will be allowed to acquire more shares in Foudello, a company that owns insurance heavyweight’s, Bona Life.
In April, BOP notified the Competition and Consumer Authority (CCA) of its intention to purchase a further 35 percent in Foudello, bringing its total stake in the business to 75 percent.
The move would buy out Capital Management Botswana (CMB) (Pty) Ltd’s 25 percent stake as well as the 10 percent owned by Bona Life Employee Share Incentive.
It would leave Reginah Vaka, with a 25 percent stake, as Foudello’s only other shareholder.
While CMB is currently undergoing liquidation, its shares in Bona Life have already been passed to BOP – represented by its General Partner, Viltry (Pty) Ltd, which in turn is controlled by Botswana Public Officers Pension Fund (BPOPF).
Further, BOP also owns a 50 percent stake in Cell City.
In determining the transaction, CCA Chief Executive Officer, Tebelelo Pule pointed out the deal is not expected to reduce the level of competition in the market under consideration in Botswana.
“Therefore, the Authority does not expect the proposed transaction to give rise to any substantial lessening of competition; restrict trade or the provision of services; or to endanger the continuity of supplies in the relevant market in Botswana,” she explained.
Pule said the analysis of the proposed transaction further revealed that the structure of the relevant market will not significantly change post the acquisition, therefore the entity will not attain any dominant position on account of the proposed transaction.
According to Pule, the proposed transaction is not expected to result in a market share accretion of Foudello or any other entity in Botswana.
Further, Pule said in terms of public interest considerations, the Authority does not foresee any detriment to matters of public interest that will arise as the result of the transaction.
Of particular importance, she also highlighted the move is not anticipated to have any adverse effects on employment.
In conclusion, the CCA CEO said assessment of the proposed transaction shows that the adopted restructuring of Bona Life was in the public interest as all other credible options explored would have resulted in severe and irreversible prejudice to the over 600 pensioners of Bona Life and the other Life Assurance Policyholders.