EVENTUALLY, Barclays Bank PLC and its subsidiary Absa Group Limited (Absa) have announced their agreement to combine the majority of Barclays Africa operations with Absa.
According to the statement released in Dar es Salaam , the proposed combination accelerates Barclays 'One Bank in Africa' strategy and its goal to become the 'Go-To' bank on the continent.
Commenting on the rationale and benefits of the transaction, Antony Jenkins, Barclays Chief Executive, said:
"This transaction 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 bank's Chief Executive of Absa Group and Barclays Africa said the move was a compelling and unique opportunity for them to further their "One Bank in Africa" ambitions by combining with a leading sub-Saharan African banking franchise.
He said they were tremendously excited by the opportunities for growth across the continent and the geographically diversified earnings potential that a combined business would deliver.
The combined business will create a leading pan-African financial services business and a platform for further growth as it 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 ten countries which represent approximately 22.5% and 30.5% of Africa's population and GDP respectively.
According to the statement, among the key features of the proposed combination are, Barclays stake in Absa will increase from 55.5% to 62.3% and 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%), Ghana (100%), Kenya (68.5%), Mauritius (100%), Seychelles (99.8%), Tanzania (100%), Uganda (100%) and Zambia (100%), as well as the Barclays Africa Regional Office in Johannesburg (100%).
"Absa will continue to own 100% of Absa Bank Limited, 95.8% of Barclays Bank of Mozambique and 55% of the National Bank of Commerce (NBC) in Tanzania. The proposed combination in respect of Tanzania will only include Barclays Bank Tanzania. Absa's majority interest in NBC will be maintained.
"Barclays Bank Tanzania and NBC will continue to operate as two separate and independent entities, with separate Boards and management teams. Both will continue to use their existing brands reflecting the strength of the brands and their operational independence," reads part of the statement.
Another key feature is that a condition precedent to the proposed combination that, subject to the applicable regulatory approvals, at least the operations in Botswana, Ghana, Kenya and Mauritius, as well as the Barclays Africa Regional Office, are transferred to Barclays Africa Limited by the first closing date.
The remaining companies in the Portfolio that have not transferred to Barclays Africa Limited by such closing date will become the subject of subsequent closings. The proposed combination follows on from the steps taken by Absa and Barclays in 2011 to integrate their African businesses from an operational and management point of view.
This initially involved consolidating the regional offices for Absa Africa and Barclays Africa in Johannesburg and establishing a combined Africa management oversight team, as well as introducing a global product strategy across the continent.
"The combination will rationally unlocks access to pan-African growth for Absa shareholders through exposure to a sub-Saharan African financial services group across eight countries; will also provide benefits to the individual African operations through leveraging strong product capabilities across the expanded group, as well as facilitating the sharing of expertise and development of skills across the businesses," said the statement.