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Busines Day / Wendy Lucas Bull
Barclays Africa Group says it is considering a joint investment-banking venture with Barclays plc, as its London-based parent plans to further reduce its controlling stake.
“At the corporate and investment bank the synergies provided a significant advantage,” Barclays Africa chairperson Wendy Lucas-Bull said at the bank’s annual general meeting on Tuesday. “We are looking at the issues business-by-business and at what the options are, like a joint venture.”
Barclays sold about 20% of its stake in the African unit in the market earlier this month as part of CEO Jes Staley’s plan to retreat from the continent and raise cash to reduce its capital burden, leaving it with 50.1%. Barclays Africa’s investment bank has used the UK parent’s distribution, technology and geographic spread to win clients and grow across its 12 operations on the continent.
Barclays Africa has also informed its parent that it would like to include a sale of shares to black investors as part of the exit plan, Lucas-Bull said.
“Black economic empowerment is one of the options we have tabled,” she said. “We’re not clear how far Plc will sell down. They have indicated they would prefer to still have a significant shareholding, but we’re proceeding based on the worst case that Plc goes to zero,” Lucas-Bull said, referring to Barclays.
More than a decade ago, Barclays Africa set up a black-empowerment deal. That stake was diluted over time and while the bank wasn’t legally bound to do another deal, the sell-down by the British bank presented an opportunity. The UK lender has said it might take two to three years to conclude the reduction of its stake.
“We continue to work with Plc on a broad range of options,” Lucas-Bull said. “We’re also working with the South African Reserve Bank and regulators across the continent, but we remain focused on the execution of our strategy. The Plc sale of the 12.2% stake demonstrated a very healthy appetite for Barclays Africa, which is very positive.”
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