20100823
reuters

JOHANNESBURG/HONG KONG (Reuters) - HSBC is in talks to buy up to 70 percent of South Africa's Nedbank in a potential $8-billion-plus deal that would give Europe's biggest lender a broader gateway to the fast-growing African continent.

HSBC and Anglo-South African insurer Old Mutual, which owns a 52 percent stake in Nedbank, said in separate statements on Monday they were in exclusive talks.

HSBC will aim to buy up to 70 percent of South Africa's fourth-largest bank from Old Mutual and minority shareholders, worth about 49.9 billion rand at Friday's close.

Analysts at Rand Merchant Bank and Keefe, Bruyette & Woods valued the stake at up to $8.4 billion, assuming a premium of about 30 percent.

South Africa's Treasury said in a statement that while it had not made any decision on the bid, it already considered Nedbank as "effectively owned" by a UK-based company, potentially removing a big regulatory hurdle to the deal.

HSBC has lagged rival Standard Chartered in Africa and a deal would bulk up its presence as more of its Asian customers look to do deals on the resource-rich continent.

It also faces a growing threat from South Africa's Standard Bank, which is 20 percent owned by China's Industrial and Commercial Bank of China, and is positioning itself as a full-service corridor to Africa.

"This is the right thing for HSBC to do if it wants to focus on emerging markets," said Dominic Chan, an analyst at BNP Paribas in Hong Kong.