London - Atlas Mara, the African finance company co-founded by former Barclays CEO Bob Diamond, said it has held talks with investors looking to combine the firm with the British lender’s operations in the continent as it swung to full-year profit.
Diamond’s New York-based private-equity vehicle Atlas Merchant Capital and the Mara Group, founded by his partner at Atlas Mara, Ashish Thakkar, are among members of a consortium in talks over a potential deal, the London-traded company said in a statement on Tuesday. Carlyle Group is working with Diamond on a prospective approach, people familiar with the matter said on Monday.
A combination with Barclays’s Africa Group would rapidly accelerate Atlas Mara’s growth plans and give Diamond control of operations he championed as the CEO of the British lender before exiting in the wake of the Libor scandal. Started in 2013 by Diamond and Ugandan entrepreneur Thakkar to consolidate African financial services firms, Atlas Mara has made four acquisitions in seven sub-Saharan countries from Botswana to Nigeria, with plans to expand that to 10 to 15 markets over the next few years through further deals.
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“Atlas Mara’s board of directors supports the exploration of the potential combination,” of the company with Barclays’s African operations, the company said in the statement. Diamond and Thakkar will “recuse themselves” from the firm’s internal discussions over the potential approach and remain “wholly committed to Atlas Mara and the execution of its strategy”.
Barclays CEO Jes Staley announced on March 1 the bank was retreating from Africa and selling down its 62 percent holding as it sought to boost its capital ratios and focus on US and UK operations. Staley is preparing to sell an initial 10 percent stake in the Johannesburg-based business to several large investors, while keeping the option to divest its entire holding, people familiar with the matter have said.
“The fact that a consortium led by Atlas Mara is interested in acquiring Barclays’ stake does not come as a surprise to us,” said Gary Greenwood, an analyst at Shore Capital in Liverpool, England with a buy rating on Barclays shares. “If an agreement can be reached, this could present a relatively clean exit for Barclays that would, depending on price, be modestly capital accretive.”
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Staley has said Diamond lacks the “financial capability” to buy the whole of Barclays Africa Group. The African lender has a market value of R121 billion ($8.3 billion), according to data compiled by Bloomberg. South Africa’s Public Investment Corporation, the biggest money manager on the continent, holds 5.3 percent.
Atlas Mara’s pretax profit was $19.2 million last year, compared with a loss of $58 million in 2014, the company said in a separate statement on Tuesday. Lending increased 15 percent to $1.2 billion, while deposits rose 12 percent to $1.4 billion.
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