Zimbabwe approves Barclays take-over

Zimbabwe approves Barclays take-over
Published: 24 August 2017
BARCLAYS Plc is proceeding with the sale of Barclays Bank of Zimbabwe to Malawi-listed lender, FMB Capital, after receiving unofficial authorisation from the central bank to close the transaction, according to multiple sources.

This comes as it emerged that the Ministry of Youth Development, Indigenisation and Economic Empowerment had sanctioned the deal, despite protestations from local ownership activists who wanted the bank sold to indigenous investors.

Indigenisation Minister, Patrick Zhuwao, had been petitioned by low level managers to block the sale to FMB, while Affirmative Action Group president, Chamu Chiwanza, had threatened to confront the central bank to stop the transaction.

Zhuwao was not answering calls to his mobile phone yesterday. He also did not respond to the questions sent to him in writing.

Evaristo Dzihwema, the principal director for indigenisation and economic empowerment, was also not available to comment.

Barclays Bank of Zimbabwe low level managers had at one time sought the intervention of the courts before abandoning that course to seek involvement of President Robert Mugabe's government.

Sources said Barclays Plc expected to obtain official confirmation of the approval from the central bank in the next few weeks.

One source told The Financial Gazette this week: "Barclays Plc has been given the green light to consummate the deal while awaiting regulatory approval. Unless something bad happens, I don't expect the Reserve Bank to spin and turn back the transaction."

Another source said: "Unless something catastrophic happens, we expect the Reserve Bank to give its approval by August 31. The other approvals have already been granted."

He said Reserve Bank of Zimbabwe governor, John Mangudya, and Minister of Finance and Economic Development, Patrick Chinamasa, had both expressed support for the transaction in meetings with Barclays Plc and FMB representatives. They had also engaged workers, he said.

The source said new shareholders were already exploring integration of FMB systems into Barclays Bank of Zimbabwe.

Barclays Bank of Zimbabwe board chairman, Anthony Mandiwanza, announced to workers two weeks ago that they had to start preparing for the transition.

He is reported to have informed workers about the takeover and transition arrangements, which include payment of bonuses to staff upon Barclays Plc's exit.

Mandiwanza was not available when sought for comment yesterday. "I don't see how they will allow politics to intervene in stopping a commercial transaction. That sale is a done deal and regulatory approval will simply be a formality," the source added.

Worker representatives also said they had been assured by Chinamasa that the disposal would be approved.

Barclays Plc, which controls 67,68 percent shareholding in Barclays Bank of Zimbabwe, announced the sale of its majority shareholding in the bank to FMB on June 1, but said completion of the transaction was subject to regulatory approvals, which it expected by the end of the third quarter in September.

FMB will acquire 43 percent of the Zimbabwe business, with an option to purchase an additional 10 percent which Barclays Plc will hold for three years.

Fifteen percent of the shares will be given to workers.
- fingaz
Tags: Barclays,

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