Barclays PLC reduces its African stake to 23.4%

Barclays PLC has reduced its shareholding in Barclays Africa to 23.4%.

On Thursday, Barclays Africa announced that following the completion of South Africa’s largest bookbuild in South African Rands, Barclays PLC has sold 33.7% of Barclays Africa.

The issued share capital was at a price of R132 per share.

A statement from the bank and copied to Citi Business News said, “Barclays PLC sold 285,691,979Barclays Africa ordinary shares at a price of R132 per share, which results in Barclays PLC reducing its shareholding to 23.4%.”

Meanwhile a further 7% is expected to be taken up by the Public Investment Corporation at a later date, following receipt of the necessary regulatory approvals.

“The aggregate gross sale proceeds were approximately R37.7 billion,” the statement added.

It was announced in March 2016 that Barclays PLC would reduce its shareholding over time.  The overwhelming investor interest in this bookbuild process that took place overnight has given Barclays PLC the opportunity to expedite this process.

“The completion of this transaction demonstrates an exceptionally healthy investor appetite for Barclays Africa and our strategy of becoming a leading standalone financial services group in Africa,” said Maria Ramos, Barclays Africa Group Chief Executive Officer.

The significance of this sell-down is that Barclays PLC is no longer the controlling shareholder of Barclays Africa, which now has a diverse shareholder portfolio made up of very supportive, long-term, institutional and individual investors.

Barclays PLC will remain an important shareholder and will support Barclays Africa throughout the sell-down and operational separation processes, which are already well underway.

Barclays PLC and Barclays Africa will continue to work with regulators to ensure that the sell-down and separation are managed appropriately, with no unnecessary impact to stakeholders or the business.

According to Ms Ramos, independence from Barclays PLC will create several opportunities, which will ultimately result in benefits for different stakeholders, “This is a very exciting time for Barclays Africa.

As announced in February 2017, Barclays PLC has agreed to contribute approximately R12 billion (£765 million) primarily to fund the investments required for Barclays Africa to complete the separation from Barclays PLC.

The contribution will, in part, go towards investments in technology, rebranding and other separation projects. This process presents an opportunity to modernise and harmonise systems across Barclays Africa operations.

Ownership of Barclays and Absa operations in Africa does not change as a result of the reduction in shareholding.