Carlyle backs BancABC owner’s Barclays Africa Bid

SHARE   |   Monday, 25 April 2016   |   By Sky News
Carlyle backs BancABC owner’s Barclays Africa Bid

Bob Diamond has enlisted support from a major US buyout firm to bid for Barclays' African operations, Sky News learns. One of the world's most powerful buyout firms is backing a daring attempt by Bob Diamond, the former Barclays chief executive, to swoop on the lender's African operations. Sky News has learnt that The Carlyle Group, which owns household name companies in the UK such as Addison Lee, is working with one of Diamond's investment vehicles on a bid for Barclays Africa Group Limited (BAGL). The news will underline the former Barclays chief's efforts to win control of the operations he helped to build during his long career with the bank. His plans remain, however, at a relatively early stage, and no firm proposal has yet been made to the board of Barclays, according to insiders. Diamond's proposal is being hatched through Atlas Merchant Capital, which was established in 2013 "to participate in compelling market opportunities in the financial services sector". That move came a year after Diamond left Barclays shortly after it had been fined nearly £300m by regulators in the UK and US for its role in the global Libor rate-rigging scandal.

Jes Staley, Barclays' new chief executive, said in March that the bank would seek to reduce its 62.3% stake in BAGL, which has majority stakes in banks in Botswana, Ghana, Kenya, Mauritius, Mozambique, Seychelles, South Africa, Tanzania, Uganda and Zambia - making it one of the continent's largest banking groups. It also has representative offices in Namibia and Nigeria, as well as insurance operations in Botswana, Mozambique, South Africa and Zambia. Staley's decision to offload most of its shareholding has angered some investors, who say privately that it should instead be focusing on getting out of investment banking, where it has struggled for years to generate acceptable returns. Barclays will hold its annual meeting in London this week, where it will avoid the traditional protests from institutional inve

stors over the size of its bonus pot but is nevertheless likely to be scrutinised over key strategic decisions including the proposed African sale. The bank has already warned in recent weeks that - along with Wall Street rivals which have reported dire first-quarter results - a slowdown in trading and advisory income in its investment bank is hurting it. It has also infuriated investors by slashing its dividend for the next two years despite indications from John McFarlane, Barclays' chairman that it would seek to grow the payout. Staley has defended his decision to reduce its African stake to a minority position, saying that it would allow the bank "to deconsolidate (BAGL) from an accounting and regulatory perspective, subject to shareholder and regulatory approvals if and as required". Diamond's determination to gain control of BAGL, which has a market value in Johannesburg equivalent to nearly £6bn, has seen him turn to one of the world's most formidable investors for support.

Carlyle, which reports its own quarterly results to Wall Street this week, manages more than $180bn (£125bn) in assets, although it has a relatively limited presence in Africa. Through Atlas Mara, another vehicle created by Diamond, the former Barclays chief has established a presence in seven African countries, including Botswana, Nigeria and Rwanda. It is unclear how a proposal from Atlas Merchant Capital and Carlyle would be structured. Other investors are also said to be in discussions with Diamond's vehicle. A spokesman for Diamond and Carlyle both declined to comment on Sunday.