African Rainbow Capital (ARC), which is owned by billionaire Patrice Motsepe, has invested over R2 billion ($108M) in the digital bank TymeBank.
Here’s What You Need To Know
- The latest investment was recently revealed when ARC released its preliminary financial report for the six months ended December 3, 2022. TymeBank, which calls itself South Africa’s first digital-only bank, has an effective 57.7% interest owned by ARC. With 6.2 million customers as of the end of December, TymeBank, according to a statement from ARC, is still a top digital bank.
- The Foschini Group (TFG) and TymeBank announced a partnership, deploying 600 kiosks across 22 TFG brands, thereby increasing the reach of the digital bank in South Africa, according to the report.
- TymeBank and retailer TFG increased their collaboration in January by launching co-branded financial services and goods both in-store and online. When TymeBank and TFG first teamed together, they announced aspirations to provide a wide range of financial products and create new services in October 2021.
- According to ARC, TymeBank purchased Retail Capital during the period under review to bolster the business banking services provided by the online bank.
- It continues by saying that at the end of the year, TymeBank’s value was changed to reflect the Series B3 capital raising that had been completed to pay for the purchase of 100% of Retail Capital. A little over 50% of the $60 million capital round came from the $30 million that ARC Fund provided.
- Outside of South Africa, TymeBank’s global division, Tyme Global, recently partnered with JG Summit to establish its digital bank, GOtyme, in the Philippines.
- According to ARC, the fair value of the Tyme Global investment was increased by 39% through the ARC Fund and ARC FSH to R696 million in order to reflect the post-money value of the recently completed capital raising. It adds the potential of Tyme Global and the thesis around developing a multi-country digital bank at scale are starting to come to fruition.
“During the period under review, the value of ARC Fund’s effective investment in ARC Investments reduced from R700 million at 30 June 2022, to R587 million at 31 December 2022, due to a decline in the share price,” the report noted.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard