Angola: Geocapital to enter market in partnership with Sonangol

7 January 2008

Macau, China, 7 Jan – Geocapital, the holding company for investment in Portuguese-speaking countries of businessmen Stanley Ho and Ferro Ribeiro, will begin its activities in Angola in partnership with state oil company Sonangol, in a change to the strategy it initially outlined for this market.

The information was reported by the Africa Monitor newsletter, which said that the financial holding company set up by Geocapital and Sonangol – known as Geopactum – aims to invest in the financial, energy and geo-mining sectors in Angola.

The announcement of the partnership comes at a time when Sonangol is preparing to take on a significant role in Angolan banking, a sector which geocapital had already tried to enter via Banco Angolano de Negócios e Comércio (BANC).

Sources from the Angolan oil sector last week told Portuguese weekly Expresso that Sonangol, after acquiring 49.9 percent of Millenium Angola (of Portuguese group Millenium BCP), will now have an identical stake in Banco Fomento (BPI group) and 25 percent of Totta-Angola, and later plans to sell shares to “influential” Angolan names.

The same newspaper cited Manuel Vicente, chairman of the board of Sonangol, saying that the company would also partner Banco Espírito Santo to set up financial operations to support oil investments in Brazil, with the possibility of Escom, the non-financial holding of the BES Group in Angola, which holds the diamond concessions in the country, having a stake in onshore oil exploration in the Cabinda enclave.

Before the partnership with Sonangol, Geocapital entered Angola linked to BANC, owned by Kundo Paihama, where it was expected to take on a significant stake.

This bank was focused on the Chinese community and private sector investments, by granting loans or taking stakes in companies.

According to Africa Monitor, Geocapital turned down this option due to the possibility of a partnership with Sonangol.

The agreement between the two parties led to a trip, some four months ago, to Luanda by the chairman of Geocapital, Jorge Ferro Ribeiro.

The announcement of a partnership with Sonangol comes at a time when Geocapital is acquiring significant stakes in the financial sectors of Portuguese-speaking countries.

In Mozambique, where the company had tried several approaches, Geocapital announced it was setting up a bank from scratch, Moza Banco,, in which it will have a 49 percent share, with the remaining 51 percent in the hands of around 150 investors, almost all of whom are Mozambican individuals and companies, which make up Moçambique Capitais.

The new Mozambican bank, which is due to open its first branch this year, is focused on investments and services for companies and asset management and will be headed up by the former governor of the Bank of Mozambique, Prakash Ratilal, considered to be a “heavyweight” in the sector.

In Guinea Bissau in mid 2007 Geocapital bought, from Portuguese bank MOntepio Geral, 60 percent of the capital of Banco da África Ocidental (BAO), in which Ho and Ferro Ribeiro will have amongst their associates Guinean businessman, Carlos Domingues Gomes.

Despite the small size of the Guinean banking sector, the BAO has the benefit of being authorized to open branches in member countries of the West African Monetary and Economic union (WAMEO) – Benin, Burkina-Faso, the Ivory Coast, Mali, Niger, Senegal and Togo. (macauhub)