Regulator approves Barclays’ plan to transfer shares to Absa

By James Anyanzwa

Barclays Bank Kenya has been okayed by the Capital Markets Authority (CMA) to transfer its 3.7 billion shares held by Barclays Bank PLC to Barclays Africa Ltd.

 The shares represent 68.5 per cent share holding by Barclays Bank PLC in the Kenyan outfit. This comes after Barclays PLC agreed to sell its African operations to its South African subsidiary, Absa Group.

The sale was part of the British Bank’s efforts to consolidate its functions in the sub-Saharan Africa region.

In a statement yesterday, the market regulator noted that the approval for the private transfer of the shares was issued in accordance with the provisions of the CMA Act.

Central Bank approval

It, however, added that the deal was still subject to BBK securing necessary approval from the Central Bank of Kenya.

The authority also said there would be no change in beneficial ownership after the transfer.

“Consequently, implementation of the private transfer of the securities will result in Barclays Africa Ltd’s direct share holding being 68.5 per cent of the issued share capital of Barclays Kenya,” said CMA. The proposed deal to combine Barclays’ operations with Absa’s divisions is expected to be completed during the first half of this year, subject to regulatory approvals across the affected jurisdictions.

Under the deal, Barclays will receive 130 million ordinary shares in Absa worth a combine $2.1 billion. This will increase its holding in the South African lender from 55.5 per cent to 62.3 per cent.

The agreement seeks to combine most of Barclays’ African business units with those of the South African bank. The merger includes operations in 10 African countries, including Ghana and Kenya, and will lead to Absa being renamed Barclays Africa Group.

 “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,” said Antony Jenkins, Barclays Chief Executive.

“This will give us a platform from which we can further grow our Africa business to the benefit of customers, colleagues, shareholders and the communities in which we operate.” 

The listing of Barclays Bank Kenya Ltd on the Nairobi bourse will continue as only the shares held by Barclays in the entity will be transferred in the proposed combination. It will not impact the shares held by the minorities in Barclays Bank Kenya Ltd.