Wednesday, 31 May 2017

Barclays to surrender control of Africa unit with £1.6bn sale



Barclays is plotting the sale of a $2bn (£1.6bn) stake in its African division in a move that will form part of its chief executive's efforts to refocus the British lender on higher-growth areas.
 
Sky News has learnt that Barclays is drawing up plans to reduce its shareholding in Barclays Africa Group Limited (BAGL) from 50.1% to approximately 28%.


A large minority chunk of the shares on offer will be acquired by South Africa's Public Investment Corporation, the African continent's biggest pension fund manager, according to insiders.


Sources said the deal could be announced as soon as Wednesday evening, following the close of stock markets in London and Johannesburg, where BAGL is listed.


It is understood the share sale is being handled by investment bankers at Barclays, Citi and Deutsche Bank.


If successfully completed, the sale will go some distance towards Barclays' eventual objective of reducing its stake in BAGL to below 20%, which will allow the London-based bank to deconsolidate the African business from its balance sheet.


BAGL has a presence in countries including Ghana, Kenya and Uganda and forms part of a presence that Barclays has had in Africa since 1925.
 
 
Jes Staley, who has run Barclays since 2015, announced the following year that he intended to withdraw from the business - a process which has required complicated negotiations with local regulators.


The company initially cut its stake in BAGL from 62% to 50.1% in May 2016, and said at its annual results in March that it would continue to sell down its shareholding periodically.


If it goes ahead, the transaction could raise up to $2bn for Barclays, capital which is likely to be redeployed elsewhere in the group.


The deal will come at a tricky time for Mr Staley, however, as he faces investigations by two UK banking regulators for his attempts to identify a whistle-blower who had made allegations about the private life of a senior Barclays executive.


Those probes are expected to take several months, while Barclays is also awaiting the outcomes of investigations by the Serious Fraud Office and Financial Conduct Authority into its multibillion pound fundraisings during the 2008 banking crisis.





SKY     News.