African Rainbow Capital takes over Mercer shares in Alexander Forbes

27 January 2020 Consultancy.co.za

Following Mercer’s withdrawal as a shareholder in South African consultancy Alexander Forbes, investment firm African Rainbow Capital (ARC) has stepped in to take over Mercer’s shares. The shares that change hands form more than R1 billion amount to 15% of Alexander Forbes.

Mercer South Africa and Alexander Forbes entered into a strategic partnership to deliver financial solutions to clients across South Africa and the broader African market as well. Mercer has now made the decision to withdraw as a shareholder from Alexander Forbes, although the partnership is expected to remain unaffected.

Global CEO of Mercer Martine Ferland shed light on the decision, saying ”At the time of Mercer’s strategic investment in Alexander Forbes, our relationship was at its initial stages. Since then, our commercial relationship has become well established and Mercer no longer believes it is as important to maintain an equity investment.”

African Rainbow Capital takes over Mercer shares in Alexander Forbes

Alexander Forbes confirmed that the reshuffle will not be disruptive to the duo’s strategic partnership or the services that they jointly deliver. Mercer previously controlled more than 34% of Alexander Forbes, 15% of which will now be taken over by ARC to take its controlling interest to 33.9%.

ARC is an investment firm operating in the South African and African markets, specialising in financial services and strategic investments that deliver exceptional returns on equity. The JSE-listed firm is fully Black owned, and works extensively in the social sphere with church groups, trade unions and women’s groups, among others.

The firm is furthering its stake in Alexander Forbes at a time when the latter is driving its inorganic growth strategy while restricting its focus to a pool of core clients. This has meant a lot of strategic reshuffling in recent times, and the latest development gives more with which to adapt.

Commenting on the increased stake, co-CEO of ARC Johan van Zyl said, “Our further investment in Alexander Forbes is in line with our stated strategy that Alexander Forbes is a key part of ARC’s financial services strategy going forward and the strategic opportunities we see. We believe real value can be unlocked for all stakeholders.”


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