BANK Windhoek’s parent company has terminated discussions with the UK-based Barclays PLC for the acquisition of a controlling stake in the local bank.
Capricorn Investment Holdings (CIH), Bank Windhoek’s holding company, announced in a statement yesterday that the negotiations had been put on ice to allow the bank to focus its attention ‘on the successful execution of the CIH group strategy and the strategic initiatives that will drive growth in the group’s business units’.The deal in which Barclays was to acquire 49,9 percent indirect interest in Bank Windhoek has been delayed by the UK bank’s strategy to combine the majority of its Africa operations into one. The deal was approved by the Bank of Namibia in May this year after an Absa application was declined by the central bank. Absa is majority owned by Barclays.The Bank of Namibia shot down the Absa application on the grounds that it would have exposed the local banking industry to a single country’s risk. The majority of banks in Namibia are mainly South African owned.In its 2010 application, Absa wanted to acquire at least 70 percent shareholding in Capricorn Investment Holdings and, through that, Bank Windhoek.In a statement earlier in the year following the approval of the Barclays application, the Bank of Namibia said: ‘The application [Absa] was disapproved mainly because, firstly, it was going to make all domestic banks majority foreign owned to an even higher percentage (from 65% to close to 80%). Secondly, this could have further exposed the Namibian banking industry to a single country risk.’The strategy by Barclays to first consolidate its Africa operations had delayed the merger with Bank Windhoek.’Barclays has subsequently advised CIH that it won’t be in a position to pursue the Bank Windhoek transaction until the proposed combination of the majority of its African business with Absa is further progressed,’ Capricorn said in its statement yesterday.In a statement in August Maria Ramos, chief executive of the Absa Group and of Barclays Africa, said the consolidation strategy was not expected to be completed until 2013.Neither Barclays nor Capricorn has ruled out resuming the negotiations in future.Johan Swanepoel, group managing director of CIH, said: ‘Barclays and CIH continue to have a good relationship and CIH would welcome any future approach by Barclays’.For its part Barclays, according to CIH, has ’emphasised that it continues to hold Bank Windhoek and CIH in high regard and that it remains interested to pursue this transaction at an appropriate time in future’.The deal was seen as a demonstration of confidence by foreign investors in Namibia’s banking industry.
