Barclays Africa: A potential buyer

Atlas Mara has released a statement following the speculation by media that it is looking to acquire Barclays PLC’s (Barclays) stake in Barclays Africa Group (Barclays Africa). The company, founded by former Barclays’ chief executive Robert Diamond, has partnered with the Carlyle Group to complete this acquisition, according to numerous media reports.

The statement revealed: “Atlas Mara Limited acknowledges that it has had discussions with a consortium of investors that is exploring an acquisition of Barclays' stake in Barclays Africa and a potential combination of Atlas Mara with Barclays Africa.”

The acquisition

In explaining the decision to purchasing Barclays Africa, Atlas Mara stated: “Atlas Mara's Board of Directors supports the exploration of the Potential Combination, given the expected positive impact on accelerating the Company's strategy to build sub-Saharan Africa's premier financial institution. Atlas Mara's Board has taken advice from external legal counsel with respect to various corporate governance matters. In the event that the Consortium reaches a definitive agreement with Barclays in relation to Barclays Africa, it is expected that Atlas Mara will enter into substantive discussions about the Potential Combination with the Consortium.”

It added: “To the extent that such discussions result in a proposal being made to the Company by the Consortium necessitating review by the Board of Directors of Atlas Mara, Mr Diamond and Mr Thakkar will recuse themselves from such discussions.  Mr Diamond and Mr Thakkar remain wholly committed to the Company and the execution of its strategy.”

However, Atlas Mara stressed that due to the complexity of the agreement and the early stages of the discussion, there is no assurance at this stage that the acquisition will be completed. “The Company will keep the market apprised of developments as and when appropriate.  Any proposed transaction will be subject to regulatory and shareholder approvals,” said Atlas Mara.

Barclays responds

In an emailed response to Justmoney, Barclays Africa said: “Barclays PLC said on 1 March that they plan to reduce the stake to a level at which they could deconsolidate and they will be open to options. For the latest updates in this process, we would point you to the various statements PLC has made on and since that date.

“What we can say is that there has been no lack of interest, and we will work closely with Barclays PLC and regulators on the best option for our stakeholders.

“We have an enviable franchise in Africa with a return on equity of 17% in 2015. Our strategy and our values remain unchanged.

“We will update the market when it is appropriate to do so.”

Barclays announced its intention to sell its stake in Barclays Africa earlier this year. The sale is expected to take place over the next two to three years according to the banking group. The bank has come out to reassure customers that the sale will not have any impact on the running of the bank, and that business will carry on as usual.

To read more on the sale of Barclays Africa and investing in Absa (a subsidiary of Barclays Africa), click here.