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Diamond's Atlas Mara moves in on Barclays Africa

The mooted sale is part of Barclays chief Jes Staley's plan to sell
April 27, 2016

Bob Diamond could once again have skin in the game where his former employer Barclays (BARC) is concerned after his Atlas Mara business confirmed talks surrounding the former's African operations.

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London-listed Atlas Mara (ATMA) is a joint venture between Mr Diamond's US-based Atlas Merchant Capital and Mara Group, an African conglomerate founded by Dubai-based entrepreneur Ashish Thakkar.

It was set up with the intention of acquiring businesses in the African financial services sector in order to build a pan-African banking group. So far, the group has made acquisitions including the Finance Bank of Zambia and a majority stake in Banque Populaire du Rwanda. Atlas Mara subsequently merged the latter with the Rwandan BRD Commercial Bank, the commercial arm of the Development Bank of Rwanda, which it acquired in 2014.

Newly appointed Barclays chief executive Jes Staley announced the bank's intention to sell off its 62.3 per cent stake in Barclays Africa at the time full-year results were released in March. The reasons management gave for the sale were the level of capital the group was required to hold against the business, the international reach of the UK bank levy and burdensome regulatory requirements.

The sale is part of a major restructure of the banking group. Barclays is selling off non-core assets - including its Italian and Portuguese retail and Asian wealth operations - to streamline its operations and prevent a drag on its core businesses. Instead, management is focused on the UK and US banking operations.

Non-core risk-weighted assets were reduced by a further £3.4bn to £50.9bn during the first quarter of this year. A negative £242m in income led to a pre-tax loss of £815m for the non-core businesses. However, there was some good news. Core businesses - the UK retail division and corporate and international operations - enjoyed an 18 per cent rise in pre-tax profits to £1.6bn, led by a strong performance from the latter.

European financial services private equity company AnaCap Financial partners has also announced it is in exclusive talks to buy Barclays' French retail banking and wealth businesses.