Barclays and ABSA plan to combine, target Africa

Banking institutions Barclays and its subsidiary Absa are discussing combining to operate as one bank in Africa.

“This is expected to involve the combination of Barclays interests in Botswana, Ghana, Kenya, Tanzania, Uganda, Zambia and the Indian Ocean with Absa, with Barclays Bank PLC remaining as the majority shareholder of the combined African operation,” the two said in a joint statement on Tuesday.

“The listings of Barclays subsidiaries in Kenya, on the Nairobi Securities Exchange, and in Botswana, on the Botswana Stock Exchange, would be maintained.”

Only Barclays holdings in these listed subsidiaries would be included in the proposed combination.

The proposal would be subject to the approval of the boards of Barclays and Absa, and Absa shareholders and regulatory approvals.

“There can be no certainty that these discussions will lead to a combination,” the two banks said.

“The proposed combination would not be expected to be completed until 2013.”

The proposal, whether or not successful, could have an effect on the price of Absa’s shares.

Maria Ramos, CEO of Absa Group and Barclays Africa said: “This proposed combination… is the next logical step in delivering our ‘One Africa’ strategy, which Barclays PLC announced last year.”

“We have already consolidated the regional offices for Absa Africa and Barclays Africa, as well as introduced a global product strategy for banking across the continent.”

Ramos said she was excited by the opportunities for growth in Africa.