DB X-TRACKERS
Sygnia to buy bank’s tracking business
Sygnia plans to use a Nedbank bridge facility to cover R320m of the price, with the rest funded internally
Money manager Sygnia has clinched a deal to acquire all of the shares in db X-trackers, Deutsche Bank SA’s exchange-traded funds (ETF) business. The deal will see Sygnia’s index-tracking assets under management rising R11.3bn to R28.2bn. It will pay R325m for db X-trackers, which has five JSE-listed ETFs tracking global market indices. "We are paying R320m plus R5m for the working capital they [Deutsche Bank] will leave in the business," said Sygnia CEO Magda Wierzycka. "The price is based on the after-tax profits of the business, which were R38.1m for the 12 months to December 31 2016." Sygnia plans to use a Nedbank bridge facility to cover R320m of the price, with the rest funded internally. It then plans to launch a rights offer to settle the bridge facility once suspensive conditions have been met and it emerges from a closed period. The conditions include approval by the competition authorities and the Financial Services Board. The deal is expected to close by August 31 2017. W...
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