Absa Group’s shares yesterday dropped almost 6 percent in early trade following the announcement that Barclays had sold 63 million shares of the financial services for a for £526 million (R10.5 billion) through an accelerated bookbuild placing.
In a statement, Absa said following the sale, Barclays would own 7.44 percent of the total issued ordinary shares of the group, cutting its holding at Absa by half. The bank priced the shares at R164 each.
Barclays, which has its headquarters in London, had a 15 percent stake in Absa before the sale, and has been shedding its holding in Absa in recent years. In 2017, Barclays Africa Group sold most of its holding on Absa.
Barclays said the proceeds of the sale would be used for general corporate purposes, and the placing would raise the bank's core capital ratio by about 10 points basis.
Absa was formerly part of Barclays Africa group until the British bank decided to streamline its African exposure as part of a strategy revamp.
Earlier this month, Barclay's capital levels became under investigation following regulators warning British lenders against gaming pension rules to bolster capital ratios.
BUSINESS REPORT ONLINE