BARCLAYS Bank of Kenya will be majority owned by South African bank Absa in the first half of next year.
This is after the South African bank said it was buying out African operations of Barclays Plc which holds a 68.5 per cent stake in Barclays Kenya.
The two banks however clarified that the listings of Barclays Bank Kenya on the Nairobi Securities Exchange will not be affected since only the shares held by Barclays Plc will be transferred in the proposed combination.
"The proposed combination will not impact the number of shares held by the minorities in Barclays Bank Kenya Limited and Barclays Bank Botswana Limited," a statement issued said yesterday. Barclays Bank Kenya is owned 27.5 per cent by the public through the NSE.
The Sh178.5 billion ($2.1 billion) deal will see Absa Group acquire a majority stake in Barclays Africa Limited thereby increasing Barclays stake in Absa from 55.5 per cent to 62.3 per cent.
The combination will affect Barclays ownership interests in Botswana, Ghana, Kenya, Mauritius, Seychelles, Tanzania, Uganda and Zambia, as well as the Barclays Africa regional office in Johannesburg. The proposed transaction excludes Barclays operations in Egypt and Zimbabwe, the statement added.
"The proposed combination is expected to complete in the first half of 2013, subject to fulfillment of the conditions precedent, including regulatory approvals across the affected jurisdictions," a joint statement said.
To reflect the enlarged portfolio and the pan-African focus of the business, Absa Group Limited will be renamed "Barclays Africa Group Limited" and the composition of the board of Absa Group will be reconstituted accordingly.
The statement said the combination will create the largest bank in Africa by number of branches, with a network of more than 1,300 outlets across ten countries.
It will also help to accelerate plans to expand corporate banking, market activities and bancassurance in Africa as well as providing benefits to the individual African operations through leveraging on strong product capabilities and staff expertise.
Barclays said combining the businesses would help increase growth opportunities in Africa where Absa has been slow to capitalise on Barclays' wide presence on the continent, trailing fast-moving rival Standard Bank.
Absa Group and Barclays Africa CEO Maria Ramos said: "This is a compelling and unique opportunity for us to further our "One Bank in Africa" ambitions by combining with a leading sub-Saharan African banking franchise."