LONDON: Barclays cut its stake in Barclays Africa Group to 15 percent sooner than expected on Thursday, ending more than 90 years as a major presence in the continent.
The British bank, which under Chief Executive Jes Staley is firmly focused on Britain and the United States, said it was selling £2.2 billion ($2.83 billion) worth of shares in Barclays Africa Group due to strong investor demand.
Barclays had said on Wednesday it would sell shares worth 1.5 billion pounds in its second such sale since announcing plans to offload most of its African business.
The bigger share sale initially lifted shares in Barclays, which is partly relying on the funds raised to meet capital requirements identified as a concern by the Bank of England in November. By 0835 GMT, the shares were down 0.1 percent.
The sale is expected to mean an increase of approximately 27 basis points to Barclays' core capital ratio, a key measure of financial strength, which was 12.5 percent at 31 March 2017 .
"We still see this deal as utterly transformational for Barclays’ capital position, which in turn offers specific opportunities for earnings enhancement," analyst Ian Gordon at Investec wrote in a note following the announcement.
Barclays, whose shares were trading up 0.5 percent at 0740 GMT, said on Wednesday that South African pension fund Public Investment Corporation would buy 7 percent of the shares, raising its holding to 14 pct according to Thomson Reuters data.
The Barclays Africa Group shares, which were up nearly 3 percent at 143 rand at 0835 GMT, will be priced at 132 rand a share, the bank said.
That represents a 5 pct discount to Wednesday's closing price of 139 rand and will raise an aggregate 2.2 billion pounds, the bank said, adding it will then place an additional 12.7 million shares in a black economic empowerment scheme.
Barclays said in March 2016 it would sell most of its 62.3 pct stake in Barclays Africa Group, giving itself two to three years to complete the sale. Its first sell down of 12.2 percent was completed in May 2016, but the bank had since been hindered by regulatory delays and political upheaval in South Africa.
Since taking over 18 months ago, Staley has scaled back the bank's geographic footprint and emphasised investment banking, although his attempts to revitalise this business have been clouded by investigations in the U.S. and Britain.
Staley has also faced criticism from investors following his attempts to unmask a whistleblower, which Barclays insiders fear could unseat him if the findings of inquiries are damning.
Barclays also faces regulatory obstacles, with an ongoing probe by Britain's Serious Fraud Office (SFO) into its 2008 cash call at the height of the financial crisis and allegations by the US Department of Justice (DOJ) over mortgage mis-selling.
Analysts at KBW said the completion of the sale earlier than expected was positive for the bank's capital ratio.
"However this still remains far from market leading (still below Credit Suisse or Deutsche Bank), whilst a number of headwinds remain outstanding," they added in a note.
Barclays makes early African exit with $2.8bn share sale
Barclays makes early African exit with $2.8bn share sale
Acwa signs key terms to develop 5GW of renewable energy capacity in Turkiye
JEDDAH: Saudi utility giant Acwa has signed key investment agreements with Turkiye’s Ministry of Energy and Natural Resources to develop up to 5 gigawatts of renewable energy capacity, starting with 2GW of solar power across two plants in Sivas and Taseli.
Under the investment agreement, Acwa will develop, finance, and construct, as well as commission and operate both facilities, according to a press release.
The program builds on the company’s first investment in Turkiye, the 927-megawatt Kirikkale Independent Power Plant, valued at $930 million, which offsets approximately 1.8 million tonnes of carbon dioxide annually, the statement added.
A separate power purchase agreement has been concluded with Elektrik Uretim Anonim Sirketi for the sale of electricity generated by each facility.
Turkiye aims to boost solar and wind capacity to 120GW by 2035, supported by around $80 billion in investment, while recent projects have already helped prevent 12.5 million tonnes of CO2 emissions and reduced reliance on imported natural gas.
Turkiye’s energy sector has undergone a rapid transformation in recent years, with renewable power emerging as a central pillar of its strategy.
Raad Al-Saady, vice chairman and managing director of ACWA, said: “The signing of the IA (implementation agreement) and PPA key terms marks a pivotal moment in Acwa’s partnership with Turkiye, reflecting the country’s strong potential as a clean energy leader and manufacturing powerhouse.”
He added: “Building on our long-standing presence, including the 927MW Kirikkale Power Plant commissioned in 2017, this step elevates our partnership to a new level,” Al-Saady said.
In its statement, Acwa said the 5GW renewable energy program will deliver electricity at fixed prices, enhancing predictability for grid planning and supporting long-term industrial investment.
By replacing imported fossil fuels with domestically generated clean energy, the initiative is expected to reduce Turkiye’s exposure to global energy market volatility, strengthening energy security and lowering long-term power costs.
The company added that the economic impact will extend beyond the anticipated investment of up to $5 billion in foreign direct investment, with thousands of jobs expected during the construction phase and hundreds of high-skilled roles created during operations.
The energy firm concluded that its existing progress in Turkiye reflects a strong appreciation for Turkish engineering, construction, and manufacturing capacity, adding that localization has been a strategic priority, and it has already achieved 100 percent local employment at its developments in the country.
