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Investigating partnerships with local players: Build, buy or partner?
Journal of Securities Operations & Custody,
3
(4),
298-304
(2011)
Abstract
African markets such as South Africa, Egypt and Nigeria offer diversification opportunities to global investors. Such economies show significant growth and opportunities, notwithstanding peculiar challenges. Domestic custodians offer safe-keeping, settlements, reporting, foreign exchange and corporate action, as well as value-added services. The big question for the global custodian is no longer whether to play in these markets — that choice has in fact been made for them but, how should they enter? Their options are categorised as ‘build’, ‘buy’ or ‘partner’.Building may promise control, brand purity and absence of legacy problems but it is hardly the quickest-to-market option. Buying gives access to existing licences, skills, structures and legacy business and a quicker time to market, but poses usual acquisition challenges. Partnering via an agency would likely provide the quickest-to-market option, links and domestic knowledge on an ongoing basis; however, there is exposure to partner risk, which must be properly appraised.
Keywords: African markets; domestic custodians; global custodians; building; buy; partner; service standards; risk
The full article is available to subscribers to the journal.
Author's Biography
Toyin Sanni is CEO, Trustees and Global Investor Services at United Bank for Africa plc, (UBA), ‘Africa’s Global Bank’. She has over 25 years’ experience in investor services, law and finance. Prior to joining the UBA Group, she was the Managing Director of Cornerstone Trustees Limited, and before that headed Trustee Services at First Trustees Nigeria Limited, the trust arm of the First Bank of Nigeria. Toyin holds a master’s degree in law as well as the professional qualifications of the Institute of Chartered Secretaries and Administrators, ICSA UK and the Chartered Institute of Stockbrokers (CIS) Nigeria. She is the President of the Association of Trustees, Nigeria, and Vice President of the Association of Pension Funds of Nigeria (APFN). An Associate of the Institute of Directors, Toyin serves on various committees and boards including the National Bond Steering Committee and chairs the Custody Sub-Committee of the Nigerian Capital Market Committee. She is a frequent speaker at various seminars and workshops, including International Investor Services events and conferences, and has served as a part-time lecturer of business law and pensions trusteeship at the University of Lagos, Nigeria.
