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FirstRand still eyeing potential Nigerian deal, chairman says

Johannesburg-based FirstRand Ltd. remains in the hunt for a midsize Nigerian bank to acquire, even after talks with two potential targets ended because of valuation differences, Chairman Laurie Dippenaar told Bloomberg News.

FirstRand would prefer its Nigerian acquisition to be a bank with a large branch network, Dippenaar said in an interview, although he added that the South African lender was unlikely to acquire a major Nigerian bank. Talks with the two banks he mentioned faltered around the valuation of their assets or the level of provisions they needed against debt that could go bad.

Dippenaar said FirstRand has been approached as continuing low oil prices pile pressure on Nigeria's economy and by extension the country's banks, according to the Jan. 19 report, which noted that FirstRand abandoned talks to buy Sterling Bank Plc in 2011. FirstRand said in 2012 that it wanted to acquire a Nigerian bank to help fund the investment-banking operations in the country of its Rand Merchant Bank unit.

Dippenaar also told the newswire that FirstRand would be willing to recapitalize a potential target if necessary, although he declined to specify a price point for a purchase.

"We'll keep looking until we find something that fits," he said. "It's a very important market, the second-biggest banking market in Africa after South Africa. We're not going to bet the bank on a Nigerian acquisition."