Barclays has sold its remaining stake in Absa Group, raising R10.7 billion as it closes out an investment it made in the South African business back in 2005. It is its second major retreat from the African market. In the sale, Barclays offered up about 63 million ordinary shares, which is 7.4 percent of Absa’s issued share capital.
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The placement priced at R169 a share, according to a statement, representing a 5.1 percent discount to the share price close on the day of the sale. That means with this exit that Barclays lost about R620 million with this investment over the nearly two decades.
The exit marks the final step in Barclays’ plans to withdraw the vast majority of its presence from Africa, after then-boss Jes Staley said in 2016 the firm would shift to focus more of its efforts on the US and Britain. Staley’s plans spurred the bank to offload its 62 per cent stake in Barclays Africa, which was a merger of Absa and Barclay’s African operations and counted around 45,000 employees – a third of all Barclays staff prior to the exit. Absa controls banks in 10 African countries, including Ghana, Kenya, Botswana and Tanzania, serving millions of customers.
The shift in focus toward its core markets also involved proposals to shutter some of the lender’s smaller operations in Asia, Brazil, Europe and Russia.
The British lender’s only presence in Africa will now be reduced to a representative office in Johannesburg which is able to support its investment, private and corporate banking clients. In 2020, the private bank was granted a licence in South Africa to offer offshore services to clients located in South Africa.
The previous first time Barclays exited the country was back in 1986 amidst the Apartheid era, as pressure mounted from political and economic players around the world.
