Thursday, September 28, 2023

Absa shareholders vote in favour of Barclays Africa acquisition

Absa Group shareholders have given a nod to the proposal by the bank to acquire Barclays assets across the continent at a general meeting held to vote on the multi-billion Pula transaction. This is the first hurdle in a move that will create a combined giant that will take competition head on.

The shareholders passed all the proposals, including the resolution to approve the proposed transaction and also approve the change of name.

The deal is, however, subject to regulators where Barclays operates, including Bank of Botswana, Botswana Stock Exchange and Non Bank Financial Institution Regulatory Authority (NBFIRA).

“Shareholders are reminded that implementing the Proposed Transaction remains subject to fulfilling certain conditions precedent, including various regulatory approvals, as set out in the Circular,” said Barclays Bank in a circular to shareholders.

Under the deal, Absa Group Limited will acquire Barclays Africa Limited, the proposed holding company of the portfolio, for a consideration of 129,540, 636 Absa ordinary shares, representing a value of P18, 33 billion or around P16.6 billion.

The two banks said the combined business will create a pan-African financial services giant that will take head on competition across the continent.

The JSE-listed business will serve approximately 14.4 million customers through a network of more than 1,300 outlets and over 10,400 ATMs, employing more than 43,000 people across Africa.

As a result of the transaction, Barclays’ stake in Absa will increase from 55.5 percent to 62.3 percent while Absa will continue to own 100 percent of Absa Bank Limited, 95.8 percent of Barclays Bank of Mozambique and 55 percent of the National Bank of Commerce in Tanzania.

However, Barclays’ listing on the Botswana Stock Exchange will continue to be maintained as only the shares held by Barclays Bank PLC in this entity will be transferred in the Proposed Transaction. The Proposed Transaction will not impact the number of shares held by the minorities in Barclays Bank Botswana Limited.

“As the announcement stated, there will be no change to listing at the Botswana Stock Exchange (BSE). The minority interest remains the same,” Barclays’ Finance Manager, Lipalesa Makepe has said.
In a statement announcing the transaction last year, the two banks said it is expected that Barclays Africa Limited will hold, at the effective date of the proposed combination, all or a significant majority of the portfolio, comprising Barclays ownership interests in banking operations in Botswana (67.8 percent), Ghana (100 percent), Kenya (68.5 percent), Mauritius (100 percent), Seychelles (99.8 percent), Tanzania (100 percent), Uganda (100 percent) and Zambia (100 percent), as well as the Barclays Africa regional office in Johannesburg (100 percent).

The deal excludes the volatile markets of Zimbabwe and Egypt. In a telephone conferencing on Thursday, Absa group CEO Maria Ramos said the transaction will be beneficial for both shareholders and customers.

“This deal is a significant vote of confidence by Absa in Barclays in Africa,” she said.


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