Bank in Namibian empowerment deal

Old Mutual wants to help women and families

South African bank Old Mutual is to sell $42.8m (£22.6m) worth of assets to black Namibians in the country's largest economic empowerment deal.

The finance firm will transfer shares in insurance and banking operations to employees, business consortia, womens' organisations and church groups.

About 250,000 black Namibians are likely to benefit from the move.

Empowerment schemes are being pursued in a number of African countries to strengthen black economic power.

Broad-based deal

The policies are designed to remedy historically low levels of asset ownership among black majorities and raise the low economic status of disadvantaged groups.

It is most advanced in South Africa, where a host of leading companies including Old Mutual and diamond miner De Beers have transferred investments to black groups over the past five years.

The transformation will contribute to the economic and social development of Namibia, while also making good business sense Johannes Gawaxab, Old Mutual

Under the Namibian deal, Old Mutual will hand over shares equivalent to 13% of its entire business in the country to black groups.

It has selected three partners from different regions of the country on the basis of their business experience, entrepreneurialism, empowerment credentials, and ability to attract new clients.

It will also set aside shares for about 1,000 employees as well as women's and church groups.

Trust funds are also being established to train financial advisers in the poorest communities and to provide university scholarships.

"This is not only the largest black economic empowerment deal ever undertaken in Namibia, but also the most broadly-based," said Johannes Gawaxab, managing director of the firm's African operations.

"The transformation will contribute to the economic and social development of Namibia, while also making good business sense."