Barclays Plc (BCS: Quote,BARC.L) Thursday announced that it has agreed with its subsidiary Absa Group Ltd. to combine majority of Barclays Africa operations with Absa for a consideration of around 129.54 million Absa ordinary shares, representing a value of 18.33 billion South African Rand or 1.3 billion pounds. The deal will increase the British lender’s stake in Absa to 62.3 percent from 55.5 percent.
Antony Jenkins, Barclays chief executive stated, “Bringing together Barclays Africa with Absa is an important step in furthering our ‘One Bank in Africa’ strategy and the goal to become the ‘Go-To’ bank across the continent.” Absa Group Ltd., the holding company of Absa Bank, is one of South Africa’s largest financial services groups offering banking, insurance and wealth management products and services.
Under the proposed transaction, Absa Group will acquire 100 percent of the Barclays Africa Ltd., shares in issue. Absa will continue to own 100 percent of Absa Bank Ltd., 95.8 percent of Barclays Bank of Mozambique and 55 percent of the National Bank of Commerce in Tanzania. The scope of the proposed transaction excludes Barclays operations in Egypt and Zimbabwe.
Barclays noted that the independent directors of the Absa Board have unanimously approved the deal. The proposed transaction is expected to be completed in the first half of 2013.
Following the transaction, Absa Group Ltd., will be renamed Barclays Africa Group Ltd. The composition of the Board of Absa Group will be reconstituted accordingly, the company stated.
Maria Ramos, chief executive of Absa Group and Barclays Africa, said, “This is a compelling and unique opportunity for us to further our ‘One Bank in Africa’ ambitions by combining with a leading sub-Saharan African banking franchise.”
According to Barclays, the listings of Barclays Bank Kenya Ltd., on the Nairobi Securities Exchange, and Barclays Bank Botswana Ltd., on the Botswana Stock Exchange, will continue to be maintained, as only the shares held by Barclays are transferred in the deal.
Goldman Sachs International is acting as financial adviser to Barclays.
In October end, Barclays reported a loss for its third quarter, reflecting charge on its own credit and provision for Payment Protection Insurance or PPI redress. However, the bank said it looks forward to closing out 2012 in a ‘strong position.’
In London, Barclays shares are currently trading at 251.55 pence, up 5.15 pence or 2.09 percent, on a volume of 7.91 million shares.
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by RTT Staff Writer
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