Confirming leaks on the weekend, Old Mutual on Monday morning said it had received a bid from HSBC for its stake in Nedbank. The international banking group may seek to buy as much as 70% of Nedbank; Old Mutual is expected to sell its entire 53% stake in a single transaction.

HSBC has agreed an exclusivity period while it conducts due diligence investigations of Nedbank, Old Mutual said. That locks out others believed to be interested in using Nedbank as a springboard into the African market, including Standard Chartered.

Such a deal is at the mercy of policymakers, given a distinct dearth of other objectors.

Old Mutual, for its part, has characterised a sale of Nedbank as good for both companies as well as South Africa in general, naming customers and employees among the potential beneficiaries of a big new shareholder with international experience and money to spend.

And Nedbank management has already expressed its happiness with HSBC as a potential controlling shareholder, which seems to leave nobody out in the cold.

The government may be less excited at the thought of allowing control of another bank to move offshore, with Absa already under the control of Barclays. A Nedbank acquisition would make two of the big four vassals to global groups with massive reach. Even though such a change would be cosmetic – for all its history, Old Mutual is effectively a British company these days – letting go proved hard in the Barclays case. Potential bidders, including HSBC, are understood to be spending at least as much time strategising their approach to regulators as they are their courtship of Old Mutual and Nedbank.

HSBC’s due diligence won’t be quick; with operations spread all over the continent, and exposure to complex instruments that have proven dangerous, the big bank won’t be cutting corners. That will give the government some time to make up its mind about the future structure of the local finance market, and about just how comfortable it is with globalisation.

By Phillip de Wet

Photo: HSBC Group Chairman Stephen Green attends a news conference to announce the lender’s 2010 interim results in Hong Kong August 2, 2010. HSBC’s half-year profit more than doubled from a year ago as bad debts fell sharply, and Europe’s biggest bank said it remained bullish on the outlook for emerging markets. REUTERS/Bobby Yip.