Client challenge
Founded in 2011, Respublica Student Living develops, owns and manages student accommodation. The company is driven to consistently improve the standards for the student residence lifestyle in South Africa. Respublica was seeking to gain controlling interest of the company in order to drive their growth strategy. Redefine Properties – the majority shareholder – expressed their willingness to be bought out.
In line with Respublica’s ground up approach to its residences, leveraging our real estate sector expertise, we developed a holistic buy-out funding and advisory solution. This positioned Respublica to further deliver on its vision of being the industry leader in providing aspirational student lifestyles through innovation and expertise.
RMB's solution
RMB’s Real Estate Investment Banking team has had a long-standing relationship with Respublica, having started as a minority lender in 2015. Through our deep sector expertise in real estate, RMB was able to provide a solution for the exit of Redefine by providing a R950m loan for the buy-out, despite tough operating conditions.
In addition, Respublica was able to secure funding from two international development finance institutions including IFC (USA) and Proparco (France). RMB also provided hedging facilities through its Markets team.
Before the buy-out Respublica has relied on Redefine’s BEE credentials and now needed to source BEE equity partners to establish its own BEE credentials. RMB’s Corporate Finance team conducted an evaluation and a curated roadshow to attract the right BEE partners to further contribute equity to the business.
In 2020 Respublica also moved its transactional banking business to RMB. Our Transactional Banking team provided a more user-friendly experience through our streamlined approach and automated platforms, resulting in fewer key man dependencies and manual processing bottlenecks.
Client Benefits
Respublica’s management and shareholders were able to buy out the controlling interest from Redefine, which has enabled them to drive growth in a more focused manner. By sourcing a BEE equity investor, Respublica now has its own BEE credentials – a vital factor for their growth plans in this sector. Moving their transactional banking to RMB as their primary banker has provided them with a more streamlined banking experience. Respublica is now positioned to drive future growth and continue to improve living conditions for university students in South Africa.
| Client | Respublica |
| Size of deal | R950m debt |
| Sector | Real Estate |
| Capabilities | Multi-faceted funding solution: |
| RMB's role | Adviser Lender Transactional Banker |
| Country | SA |
