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Barclays sells another tranche of African operation

BUSINESS LIVE / 01 DECEMBER 2017 - 09:00 / ROBERT LAING

The British bank’s stake in Absa’s JSE-listed parent company is now just 14.9%
Barclays, which acquired 56.4% of Absa in 2005 and increased its holding to 62.3% in 2013, announced its intention to divest its African operations in 2016.

Barclays Africa Group said on Friday morning that 1.5% of the shares had been transferred to a broad-based black economic empowerment scheme from its former UK parent, as agreed in June.

Barclays has agreed to sell 7% of its former South African subsidiary to the Public Investment Corporation (PIC) at R136.09 per share, a 14% discount to Barclays Africa Group’s R157.78 closing price on Thursday.

This transaction still needed regulatory approval, Friday’s statement said.

On Thursday evening, S&P Global Ratings issued a statement saying it was cutting its credit rating of five South African banks a notch, as expected following its downgrade of the country’s sovereign rating on Friday night.

Absa has historically benefited from having a UK owner because it inherited Barclays’s credit rating,

whereas its local competitors had their credit ratings capped by SA’s sovereign ratings.

S&P’s statement showed Absa still gets this benefit, with its rating cut to AA- from AA, whereas the other banks were all cut to BB from BB+.

Absa’s holding company Barclays Africa Group had its credit rating cut to BBB+ from A-.

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LINK - https://www.businesslive.co.za/bd/companies/financial-services/2017-12-01-barclays-sells-another-tranche-of-african-operation/

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