BNP Paribas Personal Finance, a subsidiary of French bank BNP Paribas, is to acquire South African consumer finance company RCS from Foschini Group and Standard Bank for approximately R2.65-billion (US$255-million), the companies said on Thursday.
“The potential for growth of South Africa combined with the quality of RCS management allow us to consider with confidence our entry into the South African market,” BNP Paribas Personal Finance CEO Thierry Laborde said in a statement.
“RCS is an important provider of retail credit cards in South Africa,” Laborde said. “It is a well-capitalized, well-managed and profitable company with strong expertise in risk management that has shown consistent growth since inception.”
RCS chief executive Schalk van der Merwe said the company “looks forward to expanding its presence in the southern African consumer finance market through the scale, expertise and financial support that BNP Paribas Personal Finance will bring as a shareholder”.
RCS focuses primarily on providing retail credit card facilities, personal loans and insurance to the mass middle market, both under its own brand and in association with a number of retailers in South Africa, Namibia and Botswana.
The company employs a workforce of over 1 250, services approximately 1-million cardholders, and has developed partnerships with 3 000 merchants for its general purpose card and exclusive agreements with 14 merchants for private or co-branded cards.
It is 55% owned by clothing and accessories retailer Foschini and 45% owned by Standard Bank.
The transaction is expected to be completed by the third quarter of this year.