Johannesburg - The Public Investment Corporation (PIC) has agreed to buy a 1.2 percent stake in Barclays Africa of the 12.2 percent stake that was sold by the Barclays Group yesterday.
Business Report can today reveal that PIC confirmed its intention to be the anchor investor in the placing for up to 10.3 million shares on Tuesday evening. At least two people, who are familiar with the process, said the PIC team arrived in London this week to table the offer representing up to a 1.2 percent stake in Barclays Africa’s issued share capital – the maximum permitted without regulatory approvals.
Read: Barclays begins offloading Africa business
The PIC team was comprised mostly of its senior management and about 20 other investors from South Africa who wanted to snatch the maximum of the 12.2 percent shares that went up for sale on Wednesday.
The PIC was not immediately available for comment. However, Business Report is in possession of a copy of the note sent to Barclays’ London headquarters this week.
Book build
“We have just launched a new accelerated book build for Barclays Group UK of 12.2 percent (103.6 million shares) of their stake in Barclays Group Africa,” the offer reads. “Following this sale Barclays Group UK will still own 50.1 percent of Barclays Africa.”
The emergence of the offer confirms ongoing attempts by the PIC to obtain a stake in the Barclays Africa Group after it opened talks this week for the 62.3 percent stake, which the British lender put up for sale last month.
The stake is worth about R73.78 billion and PIC, Africa’s largest fund manager, has the financial muscle necessary to bankroll the deal.
A PIC spokesman could neither confirm nor deny the reports of the offer as PIC management was said to be locked up in a meeting until late yesterday. But the offer confirms its intention to be the anchor investment pending regulatory approval.
“The lock-up (of 90 days) may be waived with the consent of the Joint Bookrunners, excluding Barclays,” the offer read, adding that such consent should not be unreasonably withheld or delayed.
Yesterday Barclays announced that it had sold 12.2 percent of its Barclays Africa stake. It said a total of 103 592 491 ordinary shares were sold to a mix of existing and new investors at a price of R13.05bn. The sale would reduce the Barclays stake in Barclays Africa to 50.1 percent.
Investor appetite
However, the news failed to lift Barclays Africa’s share price as it fell 2.32 percent on the JSE yesterday to close at R131.60.
Barclays said the completion of the transaction demonstrated a healthy investor appetite for Barclays Africa with the book covered multiple times. The transaction was subscribed at the R126 per share offer price. “Allocations were concentrated, with wall crossed investors taking up 75 percent of the offering,” Barclays Africa said.
Barclays chief executive Jes Staley said the transaction was “an important first step” in reducing its stake in the African business.
He said they would continue to explore opportunities to reduce their shareholding, including capital market and strategic options.
The group said there were over 125 interested investors in the book who wanted to take up a slice of the Barclays Africa stake. Mergence Investment Managers chief investment officer Brad Preston described the sale as a decent result for Barclays.
“Barclays sold 12.2 percent of their stake in an accelerated book build in the market (on Wednesday) after our markets closed,” Preston said.
“This reduces their stake to 50.1 percent. The book build was oversubscribed and the price that they sold at… was a decent result for them.”
BUSINESS REPORT